India's Gig Startups Use Aadhaar for Verification: Biometrics Providers Joi

Published Date : 7/9/2025 

Indian gig-economy startups are turning to biometric verification to comply with Aadhaar requirements, as they seek government approvals to ensure secure identity checks for their workers. Biometrics providers like Protean and IDfy are playing a key role in bridging the gap between private platforms and the Aadhaar ecosystem. 

Indian startups in food delivery, e-commerce, and ride-hailing are facing a critical juncture as they navigate the complexities of Aadhaar-based identity verification. With the government tightening regulations around the use of the Aadhaar ecosystem, these companies are scrambling to find compliant solutions to verify their gig workers. The push for formal approvals from the Ministry of Electronics and IT (MeitY) highlights the growing reliance on biometric technologies to ensure secure and legally sound onboarding processes. n nThe need for Aadhaar verification has become a pressing issue for India’s gig economy, which has seen explosive growth in recent years. However, the lack of a scalable and authorized method for online KYC checks has left many startups in limbo. Industry insiders point to the recent clampdown by MeitY on unauthorized Aadhaar-based onboarding services as a major catalyst. Platforms like Zoop, Surepass, and Digitap have been blocked for illicit access to the UIDAI database, underscoring the risks of non-compliance. Private entities now face strict legal exposure if they attempt to bypass the formal approval process, which requires explicit permission from relevant government departments. n nThe challenges of fraud in the gig economy are not unique to India. A 2025 Incognia report revealed that 57% of driver-side fraud cases in global ride-hailing and food delivery sectors involved fake accounts. In the UK, food delivery firms have increased the use of selfie biometric verifications after allegations of widespread account-sharing. These global trends mirror the concerns of Indian startups, which are now under pressure to adopt robust verification mechanisms to protect their operations and workers. n nBiometric service providers are emerging as key players in this space. Companies like Protean eGov Technologies are positioning themselves as intermediaries between gig platforms and the Aadhaar database. According to Bertram D’Souza, Protean’s chief product and innovation officer, the company can now offer Aadhaar authentication services to private platforms, enabling large-scale verification of gig workers. This capability leverages the trust built into the Aadhaar system to strengthen KYC processes, which is crucial for startups seeking to scale their operations legally. n nThe government’s recent announcement that private companies can use Aadhaar for specific purposes once approved by the relevant ministry has been welcomed by startups. This move is seen as a way to legally digitize verification for delivery and frontline workers. However, the challenge remains in finding secure channels for unregulated platforms to access the Aadhaar database. Some e-commerce operators have resorted to using unauthorized methods, such as offline Aadhaar website screens, which are illegal under UIDAI and MeitY guidelines. Experts like Wriju Ray of IDfy, a Mumbai-based biometric identity verification startup, are working with these companies to migrate to more secure alternatives like Digilocker-based verification. n nAnother hurdle is the lack of Digilocker adoption among gig workers. Many blue-collar staff do not have the app installed on their phones, complicating assisted onboarding. Biometric verification firms are stepping in to act as technology service providers, bridging the gap between gig platforms and authorized Aadhaar gateways. This approach operates within a strict consent framework, ensuring compliance while maintaining security. n nThe UIDAI has also introduced a QR code-based system for digital document verification, aiming to enhance security. UIDAI CEO Bhuvnesh Kumar mentioned that the new Aadhaar app may be ready within two months, signaling a shift toward more advanced verification methods. These developments are critical for startups looking to stay ahead of regulatory changes while protecting their workforce. n nProtean’s quarterly reports highlight the scale of Aadhaar authentication requests. Since its inception, the company has handled over 3.275 billion authentications, with 560 million processed in the 2024–25 fiscal year alone. Daily electronic KYC transactions now average around 1.2 million, underscoring the growing demand for secure verification solutions. UIDAI data also shows a 7.8% year-over-year increase in June, with 1.1 billion authentications and 287 million KYC processes. Face authentication transactions hit a record 158.7 million, up from 46.1 million in June 2024, reflecting the sector’s rapid evolution. n nAs the gig economy continues to expand, the role of biometric verification in ensuring compliance and security cannot be overstated. Startups that adopt these technologies will not only meet regulatory requirements but also build trust with their workers and customers. With the right partnerships and solutions, India’s gig economy can navigate the complexities of Aadhaar verification while fostering sustainable growth. 

Frequently Asked Questions (FAQS): 

Q: Why is Aadhaar verification important for India's gig economy startups?

A: Aadhaar verification is crucial for ensuring legal compliance and preventing fraud in the gig economy. It allows startups to securely onboard workers, reducing risks associated with fake accounts and unauthorized access to the Aadhaar database.

Q: How do biometric providers like Protean assist in this process?

A: Biometric providers act as intermediaries, routing authentication requests through secure channels to the Aadhaar ecosystem. This enables startups to verify gig workers at scale while adhering to government regulations and maintaining data security.

Q: What challenges do startups face in implementing Aadhaar-based KYC?

A: Startups struggle with finding secure, authorized methods to access the Aadhaar database. Unauthorized practices, such as using offline screens, are illegal, and many workers lack access to Digilocker, complicating onboarding efforts.

Q: What role does UIDAI play in regulating Aadhaar usage?

A: UIDAI enforces strict guidelines to prevent misuse of the Aadhaar database. It blocks unauthorized platforms and ensures that only approved entities can access the system, safeguarding user data and maintaining trust in the ecosystem.

Q: How does the QR code system enhance digital document verification?

A: The QR code-based system introduced by UIDAI improves security by creating tamper-proof digital documents. This innovation streamlines verification processes and reduces the risk of fraud, making it easier for startups to comply with regulations. 

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