The IMF has said India should take necessary measures to ensure privacy and security controls while implementing large identification programmes like the Aadhaar.
The global financial body identified India as a leader in the biometric identification system.
The International Monetary Fund in its fiscal monitor report on digital government said digitalisation can facilitate stronger governance and fiscal transparency, allowing better public awareness and scrutiny of the budget process and the design of fiscal policy.
"Depending on assumptions and how the reduction in leakage is expressed -- that is, the reduction in total transfers or wrongful payments -- estimated savings from digitalisation range between 0.2 and 21 per cent of cash transfers and 11 to 24 per cent of wrongful payments," it said.
"It is difficult to disentangle the effect of digitalisation from broader macroeconomic and policy developments," the IMF said.