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A digital identification system such as India’s Aadhaar, by overcoming complex information problems, helps willing governments to promote the inclusion of disadvantaged groups.

When it comes to ID systems, India's Aadhaar initiative sets a high bar for the rest of the world. Aadhaar is a state-of-the-art online system that provides unique 12-digit ID numbers to residents of India. These numbers can be used for a wide range of public and private services.

In scale and ambition, India’s unique identification effort is unparalleled. If all goes as planned, an estimated 600 million people – about half of India’s population – will have been enrolled by mid -2014. Such a program underscores how smart public sector investments can dramatically accelerate important economic development and hopefully boost our financial inclusion efforts.