Fintech companies can use DigiLocker, video-based KYC services

Tuesday 3 September 2019 10:15 CET | News

The committee on fintech-related issues has recommended the usage of video-based KYC and the services of DigiLocker for the KYC registration process by fintechs.

In its report, the committee observed that the Supreme Courts judgement – prohibiting private companies from using Aadhaar data of customers without their consent – has impacted the operations of fintech companies. The committees mandate was to take stock of developments in the fintech space globally and in India, as well as to study the regulatory climate in various geographies, identify application areas, use cases in governance and financial services, and suggest institutional regulatory upgrades enabling fintech innovations.

DigiLocker is a platform for issuance and verification of documents and certificates in a digital format. Indian citizens who sign up for a DigiLocker account get a dedicated cloud storage space that is linked to their Aadhaar or Unique Identification Authority of India (UIDAI) number.

Also, all ministries have issued interim alternative authentication procedures, while a bill is under consideration of Parliament to amend relevant acts to enable voluntary use of Aadhaar and Aadhaar authentication. The committee advised the Department of Financial Services to work with public sector banks to bring in more efficiency to their work and reduce fraud and security risks. An inter-ministerial steering committee will be set up on fintech applications in Department of Economic Affairs in the Ministry of Finance, to continue implementing this report, including exploring and suggesting the potential applications in government financial processes and applications, particularly accounting and asset management, welfare services, taxation, and handling citizen grievances.

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Keywords: fintech, video, KYC, DigiLocker, India, financial services, regulations, verification, UIDAI, identification, authentication, fraud, security risks, taxation
Countries: World

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