RBI allows banks to use Aadhaar for e-KYC

Thursday 30 May 2019 00:35 CET | News

The Reserve Bank of India has affirmed that banks can now use Aadhaar for KYC verification, only in cases where consent is given by the customer.

In addition to this, the central bank updated Aadhaar to its list of documents eligible for identification of individuals. After 2018’s Supreme Court order prohibiting the use of Aadhaar for KYC due to privacy concerns, the Union Cabinet had approved promulgation of an ordinance, which allows voluntary use of the Aadhaar number as identity proof for opening bank account and procuring mobile phone connection. Also, online payment companies received an extended deadline for full KYC compliance by six months from the Reserve Bank of India.

Thus, the central bank had mandated the prepaid payment instrument (PPI) providers and online wallet companies to complete their KYC process by 28 February 2019. The RBI had introduced KYC guidelines for all banks in 2002, under which all financial institutions are mandated to get information about the users and authenticate their identity, in order to prevent financial crimes including money laundering.

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Keywords: RBI, ban, banks, Aadhaar, e-KYC, India, verification, consent, KYC, identification, privacy, Open Banking, accounts, identity proof, compliance, wallet, financial institutions, authentication
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