The Reserve Bank of India (RBI) has announced that banks can now use the Aadhaar number as part of a customer’s original document for completing Know Your Customer (KYC) guidelines.
In an amendment to the KYC norms for regulated entities, the RBI said that banks can carry out Aadhaar authentication, or offline verification, for individuals who voluntarily opt for it. It has also added offline KYC as a new means of user verification with customer’s consent.
RBI had earlier barred the use of electronic KYC for non-benefit taking customers.
Those customers who do not intend to avail the direct benefit transfer, or subsidies, from the government, the bank should not store their Aadhaar numbers or redact the numbers they already have, the central bank said in its guidelines.
Further, it permitted business correspondents, business facilitators, and bank officials to conduct KYC for customers.
Paving the way for accounts to be opened provisionally through e-KYC, RBI said that those accounts that are opened through the use of a one-time password or OTP-based authentication done through Aadhaar remotely, face to face verification needs to be completed within one year. It has limited the balance in such accounts to Rs 1 lakh.
On February 28, 2019, the Union Cabinet had approved promulgation of an ordinance to allow voluntary use of the 12-digit unique number as identity proof for opening a bank account and procuring mobile phone connection.
Elets The Banking and Finance Post Magazine has carved out a niche for itself in the crowded market with exclusive & unique content. Get in-depth insights on trend-setting innovations & transformation in the BFSI sector. Best offers for Print + Digital issues! Subscribe here➔ www.eletsonline.com/subscription/
