Proofs in the payment

More than most other people,Nandan Nilekani knows how to turn information into hard currency. The induction of this former head of an iconic IT company as chairperson of the Unique Identification Authority of India UIDAI was meant to send out a larger message: UPA-II was willing to learn lessons from India Inc. His latest proposal to charge corporates for authentication services by leveraging the UIDAIs vast database is validation of just these expectations.

The UIDAI proposes to charge a fee,currently proposed to be Rs 5,to verify each address and Rs 10 for biometric confirmation,services that are estimated to cost companies between Rs 100 and Rs 500. This proposal works in many ways. The most obvious is by generating revenue. Rs 288 crore per year may only be a projection,and a small one at that,but it is recurring and self-sustaining. A less obvious reason to support Nandans revenue model is that it,in a way,would force the government to deliver the goods. If data collection is as shoddy as delivery of many government schemes often is,which private individual would consider paying for the information? Put another way,the success of the idea hinges on the accuracy of the data,a good way to move from outlays to outcomes in policy implementation. A third reason to support this proposal is the public-private partnership that it symbolises,that government and corporates can form a mutually rewarding relationship.

The task before Nilekani coordinating with multiple agencies and cutting through a rolodex of ID cards,to provide every Indian with a unique identity number requires managerial skills that will test the best. But Nilekani was brought in not just for his proven success in running a large corporation,but also to breathe fresh air into government implementation mechanisms. His novel scheme to generate revenue from what was originally thought of as just cost-incurring does precisely that. It deserves to be taken seriously.