MARKETING STRATEGIES ON UID BY KARVY

Submitted in partial fulfillment of the requirements for Master of Business Administration (MBA)

By VIKAS CHAUHAN Batch of 2010-12

ARMY INSTITUTE OF MANAGEMENT & TECHNOLOGY, PLOT NO M-l, POCKET P-5, GREATER NOIDA-201306 (UP) July 2011

ACKNOWLEDGEMENT
It gives me great pleasure in acknowledging the invaluable assistance expended to us by various personalities in the successful completion of this report. Our debts are due to many individuals who provided us guidance, advice and useful comments that helped us in the successful completion of this report. As usual the debts can be only warmly acknowledged but never fully recompensed.

My thanks is due to Prof. SHRUTI GUPTA and Mr. JITENDRA RAI SINGHANIA regional manager karvy stock broking Ltd who provided me the knowledge about the field and the timely guidance which helped us lot on the way for the completion of this project

Above all I owe a debt of gratitude to my parents for their encouragement.

Student Name........................................................ Date..............................................

Signature......................................

CERTIFICATE OF ORIGINALITY

I_____________________________________ Roll No __________________of 2010, a full time bonafide student of first year of Master of Business Administration (MBA) Programme of Army Institute of Management & Technology, Greater Noida. I hereby certify that this project work carried out by me at _________________________________________________ the report submitted in partial fulfillment of the requirements of the programme is an original work of mine under the guidance of the industry mentor ____________________________________________ ___________________________________________________________________________ and faculty mentor_______________________________________________________and is not based or reproduced from any existing work of any other person or on any earlier work undertaken at any other time or for any other purpose, and has not been submitted anywhere else at any time

(Student's Signature) Date: July, 2011

(Faculty Mentor's Signature)

Date: July 2011

EXECUTIVE SUMMARY

KARVY a premier integrated financial services company which has, over the years, firmly entrenched its name into various segments of the financial services industry. Backed by a sound state-of-the-art technology and a highly motivated employee force, Karvy has carved a niche for itself and is ranked among the top companies in the area of financial services. It has a wide network of 35 Branches and 93 customer service points, which give Karvy a tremendous mileage in being close to the retail customer. All of Karvy services are also backed by strong quality aspects, which have helped Karvy to be certified as an ISO 9002 Company by DNV. Karvy Stock Broking Ltd. is a Stock Broking company and is Registered Member of the National Stock Exchange, the Bombay Stock Exchange and the Hyderabad Stock Exchange. The Unique Identification Authority of India (UIDAI) was created during 2009-10 and a modest start with an expenditure of Rs 30.92 crore was made. The draft approach to creating Unique Identification Numbers to every resident in India, concept papers describing the linkages of various welfare schemes steered by different Ministries/departments of Government of India and reports of the Demographic Data Standards and Field Verification Committee and Biometrics Committee were completed. The preparatory work for the Proof of Concept Studies and the Pilots were commenced. In the current year the Proof of Concept Studies and the pilots will be completed and the UID numbers will begin to be issued. Full scale enrolment of the resident and authentication services will be commenced towards the end of the year. The Managed Service Provider will be selected and the Central Data Identity Depository will be handed over on a long term contract basis. For this budget of Rs 1900.00 crores allocated during Annual Plan 2010-11. A major part of it is to be used for reimbursement of enrolment costs to the registrars as also to the residents. The objective of this report is to study and get an overview of UID market. The study is basically aim to analyze the various strategies used by Karvy while working on this project. This project has been a great learning experience for me; at the same time it gave me enough scope to implement my analytical ability. This project as a whole can be divided into two parts: The first part gives an insight about its various aspects. It is purely based on whatever I learned at Karvy. The second part consists of what is uid and its functions. While working on this project, I applied the managerial service concepts like 4Ps of service marketing, etc. to get a better overview. Also, I analyzed performance of its competitors .Based on my understanding of the Indian market, I provided the recommendations for the investors in few of the circumstances.

TABLE OF CONTENTS

No. 1 2 3 4 5

CHAPTER Acknowledgement Certificate Of Originality Executive Summary Objective of the study Literature Review Background of UID Aadhaar : mission, timeline and Logo UIDAI: Role & Growth Legal Framework Technological Approach to UID Awareness and Communication Aadhaar Enrolment Company profile SWOT analysis Research Methodology Data Analysis & Interpretation Opportunities associated with UIDAI Challenges associated with UIDAI Revenue model Recommendations Conclusions References

PAGE No. 2 3 4 7 8 8 9 11 15 16 17 18 32 42
43 44 45 46 54

6 7

8 9

59 60 61

LIST OF FIGURES

NO. 1 2 3 4 5 6 7 8 9

Figure No.
Organisational Structure of UIDAI Regional Offices Organisational Structure under UIDAI Structure Of UID Data Collection Centres Organizational Details Organisation Structure Steps In Customer Awareness No. Of Enrolement In India No. Of Enrolement In Delhi Revenue Model

Page No.
13 14 16 19 35 37 52 53 54

OBJECTIVES OF THE STUDY

1 . To understand the concept of UIDIA project launched by Government of India . 2. To study and analysis the product offered by Karvy on UIDIA project.

3. To analyze tha various strategies used by Karvy for UIDIA project .

4 .To study the challenges involved in finding the target customers for opening new franchisees of Karvy Stock Broking Ltd. 5 .To study the challenges involved in convincing clients for taking up a new franchisees of Karvy Stock Broking Ltd.

6. To study the benefits of UID Adhaar in India .

LITERATURE REVIEW

BACKGROUND OF UIDAI

UID Aam Admi Ka Adhikar

Unique identification project

was initially conceived by the Planning Commission as an initiative that would provide identification for each resident across the country and would be used primarily as the basis for efficient delivery of welfare services. It would also act as a tool for effective monitoring of various programs and schemes of the Government.

The Mission

The role that the Authority envisions is to issue a unique identification number (UIDAI) that can be verified and authenticated in an online, cost-effective manner, which is robust enough to eliminate duplicate and fake identities.

The Logo

The design, for the logo for Aadhaar, is a sun in red and yellow, with a fingerprint traced across its centre. The logo effectively communicates the vision for Aadhaar. It represents a new dawn of equal opportunity for each individual, a dawn which emerges from the unique identity the number guarantees for each individual. The logo bring out the essence of the UIDAI's purpose and goals.The logo communicate that Aadhaar is a transformational opportunity for individuals across the country, and that it is one that will equalize access to services and resources for the poor.

The Timelines

The first UIDAI numbers will be issued over the next 12-18 months counted from August 2009. The first number would be issued between August 2010 to February 2011. Over five years, the Authority plans to issue 600 million UIDs. The numbers will be issued through various 'registrar' agencies across the country.

The UIDAI's mandate is to issue every resident a unique identification number linked to the resident's demographic and biometric information, which they can use to identify themselves anywhere in India, and to access a host of benefits and services.

The number (referred to until now as the 'UID') has been named Aadhaar, which translates into 'foundation', or 'support'. This word is present across most Indian languages and can therefore be used in branding and communication of the UIDAI program across the country.

Aadhaar would give any resident the ability to access the services and resources, anytime, anywhere in the country. Aadhaar can for example, provide the identity infrastructure for ensuring financial inclusion across the country banks can link the unique number to a bank account for every resident, and use the online identity authentication to allow residents to access the account from anywhere in the country Aadhaar would also be a foundation for the effective enforcement of individual rights. A clear registration and recognition of the individual's identity with the state is necessary to implement their rights to employment, education, food, etc. The number, by ensuring such registration and recognition of individuals, would help the state deliver these rights.

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UIDAI: ROLE & GROWTH UIDAI may initially be notified as an executive authority and later at an appropriate time it may be considered to be given statutory authority. UIDAI may limit its activities to creation of the initial database from the electoral roll/EPIC data. It may however additionally issue instructions to agencies that undertake creation of databases to ensure standardization of data elements. UIDAI will take its own decision as to how to build the database. UIDAI would be anchored in the Planning Commission for five years after which a view would be taken as to where the UIDAI would be located within Government. At the central level the UIDAI would constitute a core team of 10 personnel. The Planning Commission would separately place a detailed proposal of the complete organizational structure and full component of staff of UIDAI before the Cabinet Secretary. Approval to the constitution of the State UIDAI Authorities simultaneously with the Central UIDAI with a core team of 3 personnel. In pursuance of the Empowered group of Ministers' (EGoM) fourth meeting dated 04 November 2008, the Unique Identification Authority of India (UIDAI) was constituted and notified by the Planning Commission on 28 January 2009 as an attached office under the aegis of Planning Commission with an initial core team of 115 officials. On 25 June 2009, the Cabinet also created and approved the position of the Chairperson of the UIDAI, and appointed Mr. Nandan Nilekani as the first Chairperson in the rank and status of a Cabinet Minister. Mr. Ram Sewak Sharma has been appointed the Director General.

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ORGANISATIONAL DETAILS UIDAI was set up as an attached office of the Planning Commission with a core team of 115 officers and staff. Three Posts (DG, DDG and ADG) were sanctioned for Headquarter with 35 UID commissioners in each of the States. It has established Regional Offices in Bangalore, Chandigarh, Delhi, Hyderabad, Guwahati, Lucknow, Mumbai and Ranchi with their jurisdiction covering specific states across the country. A Technology Centre has been set up in Bangalore. 268 additional posts were created in September 2009. UIDAI at present has a total sanctioned strength of 383 officers and subordinate staff. Headquarters Organisation: The UIDAI is headquartered in Delhi with Mr. Nandan Nilekani as the Chairman and Mr. R.S. Sharma as the Director General and Mission Director. Regional Offices Organisational Structure: Each of the Regional Offices is headed by a Deputy Director General (DDG). The support structure below comprises 4 ADGs, 3 Deputy Directors, 3 Section Officers, 1 Senior Accounts Officer and 1 Accountant and personal staff.

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Fig (1) : Organisational Structure of UIDAI

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Fig (2) : Regional Offices Organisational Structure under UIDAI Planning Commission: The Prime Minister is the Chairman of the Planning Commission, which works under the overall guidance of the National Development Council

Technology Development Unit (TDU): consisting of experts in various areas of operation including technology, legal framework, procurement of hardware and software etc. that have been established. Program Management Unit (PMU): has a core team of experts in various areas of operation to start the ID issuance process and provide guidance in the areas of technology, legal, procurement of hardware & software, preparation of detailed project report, awareness building etc. They are engaged to advice the authority and work with consultants / service providers etc all on various aspects of the project including development of prototypes, testing the proof of concept, building the technology platform, designing, communication and awareness programs etc.

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Biometrics Centre of Competence (UBCC): will specify the initial biometrics system and enhance to technologies and practices. UBCC will evaluate and characterize technology, devices, algorithms and processes to assess what and when specifications need to be revised or enhanced. PROCEDURE OF UIDIA In US Security Code is issued, which give Identification to each Individual. In same way, Government is launching UIDAI Project in India to give Identification to each Individual In the Project 12 Digit number will be issued to the Individual which will be different for each Individual. The Project is launched by The Government of India to provide benefits to the common masses. Under this Project Government needs to have Biometric and Demographic Data. The authority of Collecting and Maintaining Data is given to NSDL. NSDL has further distributed its work to the Companies like Karvy, Alankit for data collection. Thereby, providing new Financial products to these Companies. Karvy is distributing Beneficiaries for this purpose. The Revenue and Cost Model of Karvy is explained above.

The Aadhaar will only guarantee identity, not rights, benefits or entitlements. LEGAL FRAMEWORK \The UIDAI would be set up under a statutory authority. The UIDAI is in the process of drafting a legislation for this purpose. The Cabinet has approved the proposal for introducing the National Identification Authority of India Bill, 2010 in Parliament. The Bill proposes to constitute a statutory authority to be called the National Identification Authority of India and lay down the powers and functions of the Authority, the framework for issuing UID numbers (aadhaar numbers), major penalties and other related matters through an Act of Parliament.

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This will involve an expenditure of Rs.3023.01 crore which includes project components for issue of UID numbers (called aadhaar numbers) by March 2011, and recurring establishment costs for the entire project phase of five years ending March 2014.

TECHNOLOGICAL APPROACH TO UID

The UIDAI has established the Biometrics Committee for developing and enhancing biometric equipment for verification process and authentication. This would include different types of biometrics like facial recognition, iris recognition and fingerprint scanning. There would be numerous challenges faced by the committee to collect biometric sensitive data. There would be consequences of False Acceptance Rates (FAR) and False Rejection Rate (FRR) and also inaccuracy in the quality of fingerprint obtained from a majority of people engaged in harsh working conditions. Another Committee by the name of DDSVP (Demographic Data Standards and Verification Procedure) would be involved in UID data field entries and authenticating and verifying procedures before generation of the Aadhaar number.

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Fig (3): Structure Of UID Data Collection Centres

AWARENESS & COMMUNICATION The UIDAI has recognised the importance of an awareness and communications strategy for the success of the UID project. An Awareness and Communications Strategy Advisory Council (ACSAC), with a mandate to recommend the awareness and communications strategy has been established to achieve the purposes of the UIDAI. Information, Education and Communication (IEC) is an important process in the enrolment strategy. The basic objective of IEC is to educate all the partners and residents so as to make them aware of the various usages and benefits which can be derived from Aadhaar. The Registrar, along with the UIDAI strives to disseminate information regarding the applications of Aadhaar so that benefits of governmental and other schemes reach the intended beneficiaries.

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To ensure comprehensive coverage across all the residents, the message of Aadhaar shall be spread through the following communication channels: Broadcast & Telecast: TV, radio, print, Internet Information: News and publications Outdoors: Posters, handouts, wall paintings, banners, hoarding Entertainment: Cinema, sports, endorsements Inter-personal: Audio, video, telecom Support infrastructure: Registrar and Enrolment Agency infrastructure

AADHAAR ENROLLMENT The process to get an Aadhaar would be circulated by the local media. The residents would be required to go to the nearest Enrolment Camp to register for an Aadhaar. The resident primarily needs to carry certain documents which will be specified in the media advertisement. Upon registering for Aadhaar, residents will go through a stringent verification process to generate authentic identification. Biometric scanning of ten fingerprints and iris will be followed by a photography process and would be given an enrolment number upon completion. Depending on the enrolment agency, residents will be issued an Aadhaar number within 20 to 30 days.

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Sample AADHAR CARD: Front Back

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The Enrolment Form:

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Documents for Verifying PoI, PoA & DoB: In enrolment and documentation process different identification documents are reguired .these documents are necessary in authentication process .there is a list of documents which are required to submit by the applicant at the time of enrolment for UID (AADHAR )card. Following are the supporting documents containing name and photo for verifying PoI of the Resident: 1. Passport 2. PAN (Permanent Account Number) Card 3. Ration/ PDS Photo Card 4. Voter Identity (ID) 5. Driving License 6. Government Photo ID Cards 7. NREGS (National Rural Employment Guarantee Scheme) Job Card 8. Photo ID issued by Recognized Educational Institution

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9. Arms License 10. Photo Bank ATM (Automated Teller Machine) Card 11. Photo Credit Card 12. Pensioner Photo Card 13. Freedom Fighter Photo Card 14. Kissan Photo Passbook 15. Central Government Health Scheme (CGHS) / Ex-Servicemen Contributory Health Scheme (ECHS) Photo Card 16. Address Card having Name and Photo issued by Department of Posts 17. Certificate of Identify having photo issued by Group A Gazetted Officer on letterhead Following are the supporting documents containing name and address for verifying PoA of the Resident: 1. Passport 2. Bank Statement/ Passbook 3. Post Office Account Statement/Passbook 4. Ration Card 5. Voter ID 6. Driving License 7. Government Photo ID cards

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8. Electricity Bill (not older than 3 months) 9. Water bill (not older than 3 months) 10. Telephone Landline Bill (not older than 3 months) 11. Property Tax Receipt (not older than 3 months) 12. Credit Card Statement (not older than 3 months) 13. Insurance Policy 14. Signed Letter having Photo from Bank on letterhead 15. Signed Letter having Photo issued by registered Company on letterhead 16. Signed Letter having Photo issued by Recognized Educational Instruction on letterhead 17. NREGS Job Card 18. Arms License 19. Pensioner Card 20. Freedom Fighter Card 21. Kissan Passbook 22. CGHS / ECHS Card 23. Certificate of Address having photo issued by Member of Parliament (MP) or Member of the Legislative Assembly (MLA) or Group A Gazetted Officer on letterhead 24. Certificate of Address issued by Village Panchayat head or its equivalent authority (for rural areas) 25. Income Tax Assessment Order 23

26. Vehicle Registration Certificate 27. Registered Sale / Lease / Rent Agreement 28. Address Card having Photo issued by Department of Posts 29. Caste and Domicile Certificate having Photo issued by State Govt. Following are the supporting documents for proof of DoB of the Resident: 1. Birth Certificate 2. Secondary School Leaving Certificate (SSLC) Book/Certificate 3. Passport 4. Certificate of Date of Birth issued by Group A Gazetted Officer on letterhead

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UIDAI ECO-SYSTEM
UIDAI Eco-System consists of various participants and their interactions with each other. The main participants in the Eco-System are: UIDAI : It is an organization that has been implemented by the Government of India . The UIDAI will prescribe various processes for enrolment and verification procedures to be Followed to enroll into the UID system. Introducer : is a person registered with the Registrar and UIDAI who will confirm the identity of a person who does not have any valid document related to his/her Identity and Address. The Introducer will only confirm the identity and address of persons whom the introducer knows. The confirmation will be done using the Introducers Aadhaar number and biometric data . Hence the introducer will be required to get enrolled first and obtain an Aadhaar number. Registrars : Registrars would include both Government and private sector agencies recognized by

UIDAI for the purpose of enrolling residents of India. For example Public Sector Banks, Insurance companies like LIC , LPG marketing companies, Rashtriya Swasthya Bima Yojna (RSBY), National Rural Employment Guarantee Act (NREGA), etc. UIDAI (1) Enrolment Ecosystem Registrars Enrolment Agency Hardware, Software Vendors IT Consultants Training & Logistics Facilitation UID Platform (2)PDS

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(3)NREGA

(4)Education

(5)Application Ecosystem State Financial Institutions Education & Healthcare Sector System Integrators IT Consultants Strategy Consultants Hardware Vendors Software Vendors Telecom Companies

(6) Healthcare

(7) Financial Services Unique Identification Authority of India 13 UIDAI and Aadhaar Enrolment Agencies: The agency appointed by the Registrar for enrolling residents. They will work on behalf of the Registrars and will be accountable to the Registrar. Enrolment Agency Supervisors: They will setup and manage the enrolment centre and handle problems that may arise there. Enrolment Agency Operators: They will capture demographic and biometric data of the residents. They are the persons who will directly interact with the residents. Carrier: Enrolment agency will tie up with courier or postal service which is referred to as Carrier 27

and they will act as the delivery agency between Enrolment Agency and CIDR. Hardware & Software Vendors: Hardware vendors will

provide the hardware such as Laptop,

Desktop, Printer, Biometric devices etc. Software vendor are providing the software such as operating system (Windows XP, Vista, Windows 7), Application software , etc. Training Agency: They are the agency to provide training to the concerned persons such as enrolment operators, supervisors, technical support staff etc. Testing and Certification Agency: They are the agency who will conduct assessment of persons intending to get employed within the Aadhaar enrolment system (e.g., as an enrolment operator). This will ensure that only trained and competent persons handle the enrolment process. Contact Centre: They will troubleshoot problems related to UIDAI applications. One can call the Helpline number or e-mail them describing the nature of the problem. Portal Maintenance Agency: They are the agency who will maintain UIDAI Website (http://www.uidai.gov.in). Authentication User Agencies: Any organization which needs to authenticate the identity of a customer/beneficiary and allow him/her to secure access to their services; e.g., Banks to verify identity of their customers and allow them to access to their savings account; NREGA to verify identity of enrolled workers and allow them access to their wage account etc

Use of Aadhaar enabled Applications on the mobile phone

While Aadhaar-based benefits and service delivery can be made available to residents via agent-assisted kiosks, the Aadhaar secure authentication model will also enable these services to be delivered to residents directly via their mobile phones. This will ensure that residents may securely access their 28

government benefits, track their bank accounts, send and receive money or make payments from the anytime-anywhere convenience of their mobile phones.

In the beginning these services may be largely informational such as updates about NREGA payments or bank balances. However it is entirely conceivable for residents to be able to register for work under the NREGA scheme as well as payments of bills, micro-insurance premiums and other money transfer transactions right from their mobile phones. In the case of self-service on the residents mobile, security is assured using two-factor authentication (i.e. by proving possession of the residents registered Mobile Number and knowledge of the residents Aadhaar PIN). These standards are compliant with the Reserve Bank of Indias approved standards for Mobile Banking and Payments

Aadhaar-based micropayments

Aadhaar, which identifies individuals uniquely on the basis of their demographic information and biometrics, gives individuals the means to clearly establish their identity to public and private agencies across the country. Aadhaar, once it is linked to a bank account , can help poor residents easily establish their identity to banking institutions. As a result, Aadhaar makes it possible for banking institutions to provide ubiquitous , low- cost micro-payments to every resident of India. UIDAI will facilitate Aadhaar based micro-payments in two phases:

1.During Aadhaar enrollment, UIDAI will collect information from the resident for the purpose of opening an Aadhaa-enabled bank account. The residents photograph and demographic data will be sent to a bank to actually open the account.

2. After enrollment, microATMs will be deployed by banks . These handled devices will make it possible 29

for residents to access their Aadhaar-enabled bank accounts for deposits, withdrawals, remittances, and balance query. The residents will authenticate themselves to the bank by using their Aadhaar number and fingerprint . It is envisioned that each of Indias 600,000 villages will have two microATMs, as Aadhaar enrollment covers the entire country. Simultaneously, microATMs will also be deployed where the urban poor reside, to bring about urban financial inclusion.

The key features of UID-enabled micropayments are as follows:

1. UID KYR sufficient for KYC: The strong authentication that the UID will offer, combined with its KYR standards, will remove the need for individual KYC (Know Your Customer) verification by banks for basic, nofrills accounts. It will thus vastly reduce the documentation the poor are required to produce for a bank account, and significantly bring down KYC costs for banks.

2. Ubiquitous BC network and BC choice: The UIDs clear authentication and verification processes will allow banks to network with village-based BCs (Business Correspondents) such as self-help groups and kirana stores. Customers will be able to withdraw money and make deposits at the local BC.

3. A high-volume, low-cost revenue approach: The UID will mitigate the high customer acquisition costs, high transaction costs and fixed IT costs that are now faced in bringing bank accounts to the poor.

4. Electronic transactions: The UIDs authentication processes will allow banks to verify poor residents both in person and remotely. More importantly, this facilitates direct transfer of benefits (eg., MNREGA wages, old age pensions) to the resident directly without the incumbent leakages of a manual disbursement system.

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The benefits with respect to Residents, Registrars, Enrollers and the Indian Government would be as follows: Residents: The Aadhaar will become the single source of identity verification. Once residents enroll, they can use the number multiple times they would be spared the trouble of repeatedly providing supporting identity documents each time they wish to access services such as obtaining a bank account, passport, driving license, and so on. The large number of residents, who currently dont have any identity documents and are therefore excluded from beneficiary lists, can also get an identity through the 'Introducer' system . Aadhaar number (or the UID) will thus become the key that opens all doors especially for the poor. Registrars and Enrollers: The UIDAI will only enroll residents after de-duplicating their records. This will help Registrars clean out duplicates from their databases, enabling significant efficiencies and cost savings. For Registrars focused on cost, the UIDAI's verification processes will ensure lower costs of identifying persons who avail of their services. For Registrars focused on social goals, a reliable identification number will enable them to broaden their reach into groups that till now, have been difficult to authenticate. The strong authentication that the Aadhaar offers will improve services, leading to better resident satisfaction. Government: Eliminating duplication under various schemes is expected to save substantial money for the government exchequer. It will also provide governments with accurate data on residents, enable implementation of direct benefit programs, and allow government departments to coordinate investments and share information.

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COMPANY PROFILE

Every 50th Indian is serviced by KARVY. Every 20th trade in stock market is done through KARVY. Every 6th Investor in India invests through KARVY, Indias No.1 Registrar and Transfer agent. Every 10th Demat Account is held at KARVY. KARVY is the First ISO - 9001: 2000 Certified Registrar in India. ABOUT KARVY GROUP: KARVY a premier integrated financial services company which has, over the years, firmly entrenched its name into various segments of the financial services industry. Backed by a sound state-of-the-art technology and a highly motivated employee force, Karvy has carved a niche for itself and is ranked among the top companies in the area of financial services. It has a wide network of 35 Branches and 93 customer service points, which give Karvy a tremendous mileage in being close to the retail customer. All of Karvy services are also backed by strong quality aspects. Karvy is a famed for providing various financial services such as Stock broking, Depository Participants, Distribution of financial products like mutual funds, bonds, fixed deposit, merchant banking & corporate finance, insurance broking, commodities broking, personal finance advisory services, placement of equity, and IPOs.Backed by a predominantly service oriented culture and also capitalizing on its experience of handling a variety of customers, we offer a plethora of financial products through our retail arm KARVY-THE FINAPOLIS. The business of distribution of financial products includes Public Issue of bonds, equity shares, fixed deposits of corporate, distribution of units of various Mutual Funds, a basket of liability products comprising personal loans, car loans, housing loans and loans against shares and as the sunrise market of Insurance products. Apart from these products, "The Finapolis" also offers

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personal tax planning advice, share broking and demat services. All these products reach the ultimate customer through our wide spread network of branches and retail outlets.

Fig(4)(a)(b): Organizational Details

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Karvy was started by a group of five chartered accountants in 1979. The partners decided to offer, other than the audit services, value added services like corporate advisory services to their clients. The first firm in the group, Karvy Consultants Limited was incorporated on 23rd July, 1983. In a very short period, it became the largest Registrar and Transfer Agent in India. VISION AND MISSION STATEMENT: Karvys aspiration of establishing itself as an integrated financial services co is propelled by a vision that is shared by the entire work force. Towards this end Karvy is dedicated itself to: Having a single minded focus on investor services. Establish as a house hold name for financial services. Set industrial standards. Stock Broking 10% + share in cash markets F & O double the cash volumes (around 6%) Activate BSE so as to reach 5% share. Our mission is to be a leading, preferred, services provider to our customer and we aim to achieve this leadership position by an innovative, enterprising and technology driven Organization, which will set the highest standards of service and business ethics.

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Fig(5): Organisation Structure KARVY STOCK BROKING LIMITED Karvy Stock Broking Limited is recognized as a keystone of the KARVY construction and focused on portfolio analysis, depository participant, and financial planning and management services. The company help for customers to create effect on portfolio and achieve the final goal by provide a monthly magazine which gives up-dated market information on market trends, investment options. It is a member of all three:National Stock Exchange (NSE) Bombay Stock Exchange (BSE) Hyderabad Stock Exchange (HSE)

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Karvy Stock Broking Ltd is Indias leading Stock Broking House, it ranks among top 5 Depository Participants in India, with the huge net work of over 500 branches in 375 locations across India and overseas at Dubai, executes 150,000+ trades in NSE/BSE. Karvy introduces Karvy Fortune, a Partnership/Association concept to provide trade execution facilities for cash as well as derivatives, on BSE. SERVICES Stock broking service Karvy offer trading on a vast platform; National Stock Exchange and Bombay Stock Exchange via its own software GOTX. Its highly skilled research team, comprising of technical analysts as well as fundamental specialists, secure result-oriented information on market trends, market analysis and market predictions. This crucial information is given as a constant feedback to the customers, through reports delivered daily. Depository Participant Offering a wide trading platform with a dual membership at both National Securities Depository Ltd (NSDL) and Central Securities Depository Ltd (CDSL), it is a powerful medium for trading and settlement of dematerialized shares. Financial product distribution Its monthly magazine, Finapolis, provides up-dated market information on market trends, investment options, opinions etc. Thus empowering the investor to base every financial move on rational thought and prudent analysis and embark on the path to wealth creation.

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Advisory Services Under its retail brand Karvy the Finapolis', they deliver advisory services to a cross-section of customers. The service is backed by a team of dedicated and expert professionals with varied experience and background in handling investment portfolios. Private Client Group This specialized division was set up to cater to the high net worth individuals and institutional clients keeping in mind that they require a different kind of financial planning and management that will augment not just existing finances but their life-style as well. Here we follow a hard-nosed business approach with the soft touch of dedicated customer care and personalized attention.

Fig(6): Steps In Customer Awareness

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ROLE OF KARVY: Karvy Data Management services being a registrar superviser took care all the roles as per UIDAI norms. Karvy scheduled meetings/presentations for efficient enrolment agencies supervisors and offered certified machinery and UID kit at some cost. The details of the UID kit offered are as below: Start Up Kit Content: LAPTOP BIOMETRIC DEVICES Fingerprint Image Scanner 4+4+2 Dual Iris Scanner NON-BIOMETRIC DEVICES 15.6 Additional TFT Color Monitor Webcam (Logitech /Microsoft )- 2 Mega Pixels 8 GB Pen Drives (2 in each Kit) Laser jet Printer HP/Canon 1 KVA SW UPS (APC/Numeric) 2-4 Hours 4 Port USB Hub Belkin Antivirus Kaspersky External 500 GB USB HDD Seagate Spike buster with 6 plug points Belkin CFL/LED/Flash Light

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Background White Screen Fire Extinguisher

UID Uniform (Two T-shirts,1 Apron and cap) Stationery (Stapler, Stapler Pins, steel scale, pens, stamp pad, pencils, erasers, cleaning kit) Carry Bag (for biometric fingerprint, scanner, Iris scanner, Laptop and webcam) Marketing material 1 Canopy 1 Back Drop(Vynil) 2 Standees 20 Banners 100 CDs 5000 Pamphlets 10,000 Blank enrolment forms

Start Up Kit Supplier: INR 2,21,000/- ( Indian Rupees Two Lakh Twenty One Thousand only) per kit is to be exclusively borne by the Facilitator, Payment should be made by DD in favor of JVR Infotech Private Limited Payable at Hyderabad. (The delivery centre for the KIT is Hyderabad for the amount mentioned above including taxes. Any other charges such as CST, Octroi etc. has to be borne by the facilitator separately, other than amount

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mentioned above, if the billing is done other than Hyderabad as per applicable taxes of the respective states) MANAGEMENT INFORMATION SYSTEM The details of this project as to who were approached for facilitating this project (Enrolment Supervisors), how many of them attended meetings, presentations, successful converts were maintained in proper MIS. Prospective clients The AMFI people, Authorised Persons, Sub-brokers of companies like ICICI, Religare, kotak in NCR region were our Target Clients. My task: Schedule meetings with prospective clients by breifing UID via telephone and maintain respective MIS. Red denotes Not Interested ; Yellow denotes Scheduled appointments ; Blue denotes interested but not have not scheduled any appointmemt.(ANNEXURE) Compiling the meeting according to date and time.

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Explain UID project

Unique Identification Authority of India (UIDAI) (Rs. 50/Aadhaar card)

Wipro(Ensuring Biometric data standard) (Rs.40/Aadhaar card)

NSDL(Karvy)/Registrar at state level/central level/Public Sector Banks(Rs.30/Aadhaar card)

Enrolment Agencies (Rs. 22.50/Aadhaar card)

Population (Aadhaar cards are being issued free of cost)

Follow Up of Meetings The following MIS shows the remarks of those who attended meetings whether they are interested in investing in the project or not.(ANNEXURE) Red Signifies Not Interested; Yellow Interested but not yet submitted DD and Documents; Blue who wants more meetings/wants to talk to business head/have doubts ; Green signifies Successful Converts who have submitted DD and necessary documents.

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SWOT ANALYSIS:

Strength: Good research team. Dedicated employees. Strong customer relationship. Strong brand name. Wide spread branches and brokers network..

Weakness: Technology need to be upgraded. Not enough advertisement.

Opportunity: Growing IPO issues. Positive outlook of people towards financial products. Growing consumer awareness about equity related product.

Threat: Market uncertainty. Galloping competition. Broad economic factors like inflation, etc. International disruptions

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RESEARCH METHODOLOGY

RESEARCH DESIGN The present study involves a detailed analysis of the Unique Identification Number project established under the UIDAI. It is a descriptive study which is associated with the information released by the government on this project and opinions and views published in print media. Also the study takes an explorative form as the UID project is at a nascent stage of its implementation and the study involves on assessing the opportunities and challenges that would be potentially faced during its implementation.

DATA COLLECTION The data for the study has been collected from secondary sources of information. The UIDAI website has been the main source of data collection for gaining insight into the development, growth and procedural information. Also national daily newspapers articles have been sources of secondary data to gain viewpoints on the UID project. Books and internet have largely contributed in concept building and gaining insights into the technological aspects of the project.

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DATA ANALYSIS & INTERPRETATION

The Unique Identification Project undertaken by the UIDAI is a project which has never been attempted by any country worldwide on such a large scale. The United States Social Security program falls short when compared to the number and diversity being addressed by Indias UID project. Thus the implications attached with the conduct of the project are massive. The UID project not only attempts to bring the countrys billion strong population together under one umbrella but also takes upon the challenge of managing a database of a billion with several technological implications and dealing with economic and political factors of the country. The opportunities and challenges that the Organisation Committee of the UIDAI has faced during the pilot study and would face during its full-fledged implementation would be huge. A few hurdles that have been successfully cleared are:

The formation of a core committee at the central and the state level. The Citizenship Act, 1955, has been amended and now a specific section on registration of citizens & issuing cards has been included.

National Identification Authority of India Bill, 2010 has been passed and approved by the Cabinet in Parliament.

Setting up of a Biometric Centre of Competence to device and facilitate the verification of the people.

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OPPORTUNITIES WITH UIDAI As India attempts to undertake the worlds largest technological project to integrate its population through Aadhaar, it comes one step closer to prove its potential to the world of its strength. As suggested through world and national surveys, India might emerge as a world superpower after China in the coming decade and as a world leader by 2035. The projects objective would help streamline the developmental process in India. France has offered expertise to India for its challenging project of allotting Unique Identification Number to 1.2 billion people in a single database. Never before in political history have India and France been so close and intimate. Software giant Microsoft shows keenness in associating itself with the UID project. Technology enhancement holds the key to the success of any project. MasterCards Chief Exeuctive also shows keen interest in the UID project and suggests the process of payment through the Mastercard network. This project, if implemented in its entirety will revolutionise governance in this country bringing social and welfare benefits to the large segment of the society deprived of the basic facilities. Banking and Healthcare are two major areas that can benefit from this project. This is a very critical project for India. It has significant transformational capabilities. If implemented soon and competently, this project can change the face of the country, by bringing about higher efficiencies and transparency, and reducing corruption (the biggest evil gripping Indian society today). This project if viewed in conjunction with development of infrastructure like availability of power, telecommunication facilities and a bureaucracy equipped to handle this project can strengthen the economic outlook of the country. India is a democratic country with diversity creeping from every corner. Aadhaar would provide a platform to integrate the population irrespective or caste, religion or geography. The identity 45

number does not recognize an individual on any characteristic, however provides uniqueness to every individual.

CHALLENGES WITH UIDAI As every coin has two faces, the UID project despite the bight opportunities comes with certain challenges. These challenges arise from two broad categories; firstly the countrys environmental (political, economic and legal factors) factors and secondly the issues directly related to the implementation of the project.

Environmental Factors India being a democratic country faces elections and change of government every five years. Thus the need to provide statutory authority to the UIDAI must be considered as otherwise the ruling government would have a control over the ruling of the committee. India suffers from social evils like corruption that does not allow transparency in the system. Also the process falters and inefficiency crawls in. The CIDR suffers threat from the bureaucratic control. The majority of the population which is categorised as BPL (below poverty line) do not have birth certificates, identity cards or any proof of nationality. Even if they did, they have no means of knowing how to access the benefits that accrue to them. Will a national identity card make their lives less difficult? How would the card issued to the rural population work in villages that do not have adequate supplies of electricity leave alone computers?

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Internal management issue would arise if any internal official attempts to compromise information or even leak data for political use.

Security and Privacy Issues: Central ID Data Repository will have state-of-the-art IT infrastructure with appropriate security controls however the weak links from security and privacy perspectives- registrars and the agencies which will capture the data, store and transmit the same to CIDR. The entire project may be susceptible to attacks from all angles - people, process and technology. Risks and threats associated by the centralized database are: Accessible over networks in real-time presents significant operational and security risks as in any such applications. If networks fail or become unavailable, the entire identification system may collapse. Biometric PII, hooked up to networks and made searchable in a distributed manner, represent significant targets for hackers and other malicious entities to exploit. Prone to functional creep (secondary uses) and insider abuse. Risk of transmitting biometric data over networks where they may be intercepted, copied, and actually tampered with, often without any detection. Risks and threats associated at various lifestyle stages: Collection o Data leakage Scenarios across various Registrars and Enrollment agencies: Intentional or unintentional compromises Logical or physical security compromise 47

 o o

Phishing, third party attacks

Integrity and accountability of Registrars and enrollment agencies Reliance on multiple vendors increases vulnerabilities

Transmission o o o o Need for secured communication channels: VPN, SSL-VPN Encryption of the data: strong encryption required for securing biometrics Key Management: departmental interactions, coordination Non-Repudiation: attack vectors like a man-in-the-middle attack

Storage o Management of roughly 10,000 TB of sensitive information spread across the country, in addition to storage in CIDR o Accountability of users : data base administrators, network administrators, application owners, third party employees o Accountability and assurance of people working with registrars and sub-registrars

Security Vulnerabilities In the cyber age, threat from the unethical cyber elements poses the most lethal threat to any technological implementation. Security threats like spoofing, tampering, substitution attacks, Trojan horse attacks,

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masquerading attacks, over- riding responses can impose serious challenges in maintaining and securing the entire process. Also a few other problems other than the security issue may create problems: Loss of Biometric Data can result in compromise of irrevocable unique identifier of a person for life Such data can be used to authenticate a person by injecting the biometric ID during transmission into CIDR through standard attacks Man-in-the-Middle Attack If Biometrics stored in Encrypted form key management Is a challenge Data may be securely available at CIDR but it may not be secure across hundreds of thousands registrars across the country Data with Registrars may be subject to Data Leakage Scenario and attacks Different registrar appointed by Government of India for this project Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank

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Dena Bank Department of Posts IGNOU IDBI Bank Indian Bank Indian Overseas Bank Life Insurance Corporation of India (LIC) Ministry of Petroleum and Natural Gas Ministry of Rural Development Ministry of Human Resource Development National Coalition of Organisations for Security of Migrant Workers NPCI NSDL Oriental Bank of Commerce Punjab and Sind Bank RGI State Bank of India State Bank of Bikaner and Jaipur State Bank of Mysore Syndicate Bank

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The State Bank of Travancore

COMPETITION BEFORE KARVY Karvy has undertaken this UID project on PAN India basis since it has its branches all over the country. The authority of Collecting and Maintaining Data is given to NSDL.NSDL has further distributed its work to the Companies like Karvy, Alankit for data collection. The UIDAI has gotten off to a brisk start with a critical mass of registrars including all state governments, 16 banks and the Life Insurance Corp. of India and its network of agents. We can see that there is a lot of competition before karvy in this project. The registrars for this project are all government offices, Banks, Life Insurance Corp. of India and some private players also. We have seen in our data analysis part also that people are more convenient to go to banks for their UID enrolment process. In NCR region, however, one of the major competitors is Alankit Assignments Ltd. Alankit launched UID project a little earlier than Karvy. Karvy launched the same a month later but with full preparation. The UID Kit offered by Karvy is way ahead in terms of quality, configuration etc than of Alankit. Presently, Karvy is in better position as compared to Alankit with respect to sale of UID Kits. Our Strengths:

KARVY -Better Configuration Machinery -Genuine OS and Licensed Antivirus -24*7 Technical Support -TDS(Tax Deducted at Source) paid by Karvy -security deposit of INR 50,000/-

Vs

ALANKIT Comparatively Low Configuration Machinery

- TDS(Tax Deducted at Source) paid by facilitator 51

TOTAL cost INR 2,21,000+50,000

-Security deposit of INR1,00,000 TOTAL cost INR 2,21,000+1,00,000

DISTRIBUTION IN INDIA

enrolement by each agencies(M)

0.344 1.96 2.22 karvy wipro alankit tera soft 2.66 4.66 smart chip

Fig(7): No. Of Enrolement In India

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DISTRIBUTION IN DELHI

no. of enrolement
40000 50000 70000 STRATEGIC OUTSOURCING ALANKIT VIRGO 90000 100000 540000 SMART CHIP DATASOFT DELHI MMTS 170000 200000 IAP TERA SOFTWARE KARVY 35000

Fig(8): No. Of Enrolement In Delhi

Here some pie chart are available that explain the participation of different enrolling agencies on this project . different companies in different areas as per their agreement with NSDL . As per the data available on uidai website , there are so many competitor infront of karvy stock broking on uid project. Around 209 enrolement agencies are registered in NSDL offices on uid project ,also having a permission from NSDL to work in different regions of india .Some of major competitors are :

1. 2. 3. 4. 5. 6. 7. 8.

Karvy . Strategic outsourcing . Alankit. Virgo. Smart chip. Data soft. Delhi mmts. Iap. 53

9. Tera software. These agencies are working hard in their areas and trying to increase the awareness of uid with its benefit . Every agencies having its own working strategies .After analyzing the given data on UIDAI website , a pie chart is designed to explain the actual participation of different agencies in enrolement of uid in india. Wipro having a maximum number of uid enrolement as comparison to other agencies .Terasoft and alankit are working on same level , small difference in their no. enrolement . Karvy just having .344 million enrolement as per the given data. Karvy having good work strategies but need more innovative ideas to increase its participation focus on some selected area of market . such as: Colleges Housing societies Offices

Other agencies applying new idea to make profit for their organization . karvy charged more on its marketing kits and start up kits thats why some operators are attracted toward its services .

REVENUE MODEL

NSDL (45)

KARVY(30)

ENROLMENT PARTNERS(22.5)

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COST STRUCTURE 2.1 Lac (Machine) 2.23 Lac 10,000(Marketi ng Mat.)

2000 (Registration) Fig(9): Revenue Model

UID is Compulsory in following Situations: For Gas Booking For Registration of Property Renting out the Property

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Features of the UIDAI Model

The Aadhaar will only provide identity: The UIDAI's purview will be limited to the issuance of unique identification numbers (Aadhaar) linked to a person's demographic and biometric information. The Aadhaar will only guarantee identity, not rights, benefits or entitlements. A pro-poor approach: The UIDAI envisions full enrolment of the residents, with a focus on enrolling India's poor and underprivileged communities. The Registrars that the Authority plans to partner with in its first phase such as the Mahatma Gandhi National Rural Employment Guarantee Scheme (NREGA), Rashtriya Swasthya Bima Yojna (RSBY), and Public Distribution System (PDS) will help bring large number of the poor and underprivileged into the UID system. The UID method of authentication will also improve service delivery for the poor. Enrolment of residents with proper verification: Existing identity databases in India are fraught with problems of fraud and duplicate/ghost beneficiaries. To prevent this from seeping into the UIDAI database, the Authority plans to enrol residents into its database with proper verification of their demographic and biometric information. This will ensure that the data collected is clean right from the beginning of the program. However, much of the poor and underserved population lack identity documents and the UID may be the first form of identification they will have access to. The Authority will ensure that the Know Your Resident (KYR) standards do not become a barrier for enrolling the poor, and will devise suitable procedures to ensure their inclusion without compromising the integrity of the data.

A partnership model: The UIDAI approach leverages the existing infrastructure of government and private agencies across India. The UIDAI will be the regulatory authority managing a Central ID Repository (CIDR), which will issue Aadhaar, update resident information and authenticate the identity of the residents as required. In addition, the Authority will partner with agencies such as central and state departments and private

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sector agencies, who will be 'Registrars' for the UIDAI. Registrars will process Aadhaar applications, and connect to the CIDR to de-duplicate resident information and receive Aadhaar. The Authority will also partner with service providers for authentication of identity.

The UIDAI will emphasize a flexible model for Registrars: The Registrars will ensure significant flexibility in their processes, including issuing cards, pricing, expanding KYR verification, collecting demographic data of residents for their specific requirements, and in authentication. The UIDAI will provide standards to enable Registrars to maintain uniformity in collecting certain demographic and biometric information, and in performing basic KYR activities. These standards will be finalised by the KYR and biometric committees constituted by the Authority.

Process to ensure no duplicates: Registrars will send the applicant's data to the CIDR for deduplication. The CIDR will perform a search on key demographic fields and on the biometrics for each new enrolment, to minimize/eliminate duplicates in the database.

The incentives in the UIDAI system are aligned towards a self-cleaning mechanism. The existing patchwork of multiple databases in India provides scope to individuals to furnish different personal information to different agencies. Since de-duplication in the UIDAI system ensures that residents have only one chance to be in the database, individuals are made to provide accurate data. This incentive will become especially powerful as benefits and entitlements are linked to Aadhaar.

Online authentication: The Authority will offer a strong form of online authentication, where agencies can compare demographic and biometric information of the resident with the record stored in the central database. The Authority will support Registrars and Agencies in adopting the Aadhaar authentication process, and will help defining the infrastructure and processes they need.

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The UIDAI will not share resident data: The Authority envisions a balance between 'privacy and purpose' when it comes to the information it collects on residents. The agencies may store the information of the residents they enrol if they are authorised to do so, but will not have access to the information in the Aadhaar database. The UIDAI will answer all requests to authenticate identity only through a 'Yes' or 'No' response. The Authority will also enter into contracts with Registrars to ensure the confidentiality of the information they collect and store.

Data Transparency: The authority will place all the aggregated data for public to access under RTI. However Personal Identity Information (PII) will NOT be accessible by any entity.

Technology will undergird the UIDAI system: Technology systems will have a major role across the UIDAI infrastructure. The Aadhaar database will be stored on a central server. Enrolment of the residents will be computerised, and information exchange between Registrars and the CIDR will take place over a network. Authentication of the residents will be online. The Authority will also put systems in place for the security and safety of information.

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RECOMMENDATIONS

Administrative Department (1) Increase the Public Awareness toward the UID benefits in future. (2) Process for handling immigrants , Dual citizenships. (3)Enrolling and tracking citizens by multitude of technologies.

Legal Department (1) To make amendments to existing legal system for accommodating UID cards. (2) Restricting multiple issuance of cards, Access Restriction should be handled.

Technical Department (1) Random number generation for UID card number. (2) Self check digits to reduce the error probability. (3)Effective Encryption and Decryption schemes and to architect system better for handling security issues.

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CONCLUSIONS
Better access to a host of government services Eliminates fake and duplicate identities which assist government to stem exchequer losses arising out of ghost identification or duplication Clearer view of population and other demographic indicators. Provides major impetus to e-Governance programs and services. Internal security scenario can be monitored well with UIDs being used to track criminals. The UIDs will provide unique identity to residents of India. Indians will not require to prove their identity to various government departments over and over again.

It will streamline benefits so that they reach the right people.

The numbers will eliminate duplication an attempts to obtain fake documents. They will facilitate mobility, especially for India's migrant population. The numbers will ensure that different public service delivery organisations work efficiently.

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REFERENCES
Web References:

"Rs.100 crore for Unique Identification Project", The Hindu (Chennai, India), 17 February 2009, http://www.hindu.com/2009/02/17/stories/2009021756751000.htm, retrieved 2009-06-26 "Nilekani to give numbers, ministries to issue cards", The Economic Times, 16 July 2009, http://economictimes.indiatimes.com/Nilekani-to-give-numbers-ministries-to-issuecards/articleshow/4782505.cms, retrieved 2009-07-18 "Nilekani takes charge, says first set of IDs in 12-18 months". The Times Of India. 2009-07-24. http://timesofindia.indiatimes.com/articleshow/4812763.cms. "India gets Info czar in Nilekani", The Statesman, 25 June 2009, http://www.thestatesman.net/page.news.php?clid=1&theme=&usrsess=1&id=258987, retrieved 2009-06-25 "PIB Press Release". Pib.nic.in. http://pib.nic.in/release/release.asp?relid=49370. Retrieved 2010-10-01. http://www.iaadhaar.com/what-is-aadhaar/ http://uidai.gov.in /index.php?option=com_content&view=article&id=57&Itemid=105 http://news.rediff.com/slide-show/2010/sep/29/slide-show-1-tembhalis-open-letter-to-pmsonia.htm http://www.dnaindia.com/mumbai/report_in-time-warp-tembhali-village-leapfrogs-topresent_1444941 "Aadhar takes off: PM, Sonia launch UID in tribal village". Indianexpress.com. http://www.indianexpress.com/news/aadhar-takes-off-pm-sonia-launch-uid-in-tribalvillage/689953/. Retrieved 2010-10-01. "Sonia is my ''Aadhaar'', says first UID recipient - NDTV Profit". Profit.ndtv.com. http://profit.ndtv.com/news/show/sonia-is-my-aadhaar-says-first-uid-recipient-102664. Retrieved 2010-10-01.

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