As per Reserve Bank of India (RBI) master circular Aadhar is accepted as Officially Valid Document for Bank KYC Process and further RBI has accepted Aadhar as valid documents under e-KYC service for KYC verification for opening bank account in India. RBI through Master Circular DBOD.AML.BC. No. 24/14.01.001/ 2013-14 dated July 1, 2013 on Know Your Customer (KYC) Norms / Anti-Money Laundering (AML) Standards/Combating of Financing of Terrorism (CFT)/Obligation of banks under PMLA, 2002 has accepted Aadhar card issued by the Unique Identification Authority of India (UIDAI) containing details of name, address and Aadhaar number may be accepted as an ‘Officially Valid Document”.
Aadhaar card is unique 12-digit number which can be issued by the Unique Identification Authority of India (UIDAI) on behalf of Government of India. Now, the Aadhaar card holder or any individual registered with UIDAI for Aadhaar card can open bank account without any need of paper work and this all started through the e-know-your-customer (e-KYC) facility. UIDAI has added this new facility of e-Aadhaar letter with the Aadhaar card through which the bank may print the prospective customer’s e-Aadhaar letter in the bank directly from the UIDAI portal and same is accepted as valid ID & Address Proof for opening Bank Account . This whole process will encourage electronic based banking system in India and avoid unnecessary problems & delays faced by customers while opening bank account. This scheme is already started in the AXIS bank and also in the HDFC bank in all over India. In the October month the Axis bank has launched this facility or e-KYC using Visa connectivity with UIDAI. And now the HDFC bank has also launching this facility with the National Payments Corporation of India (NPCI).
In this scheme the Aadhaar card will be link to the UIDAI through an authorized service agent which will be linked to the UIDAI database. The bank system will take all data directly from database of the Unique Identification Authority of India (UIDAI), includes name, address, birth date and photograph. It will also save a copy of a KYC document that is stored in the UIDAI server which was given by the individual at the time of enrollment for Aadhaar card. The bank will then print out an account opening form with all the details that are already filled in the form from the UIDAI server. In this the scheme the individual need to just to go to the nearest bank branch and tell his 12-digit Aadhaar number & also give his fingerprint or scanned in the bank branch and then his account will open in the bank or he become a bank account holder. By this facility there is no need of providing any documents for the address proof and the identity proof or submitting the copies of the documents. As per UIDAI the said facility is more secure than any other facility. For this facility banks needs to install biometric readers for scanning fingerprints at most of its branches in all over India in few months.
Banks also said that they are presently working on the integrating the bank system with the UIDAI servers. Once this will complete the open accounts without any data entry and also it become paperless as a soft copy of all the KYC documents will be automatically be saved in the bank system. Bank will also install scanners in the branches where there is a high level of registrations under Aadhaar card. Bank also started providing the facility of insta-accounts, through which customers get the whole account kit – cheque book, debit card and PIN number and the pass book – across the counter. Banks are also looking for the renewal of KYC. Customers need not worry about carrying their documents for identity and address proof to the branches. By this facility customer can easily open his account in any of the branch in all over India but avail this facility customer i.e. individual has to registered himself for Aadhaar card.
Banking Process flow would be as follows for Opening Bank Account using Aadhar Card or Biometric Details of Customer:
- Customer walks into CSP of a bank with his/her 12-digit Aadhaar number and explicit consent and requests to open a bank account with Aadhaar based e-KYC.
- Bank representative manning the CSP enters the number into bank’s e-KYC application software.
- The customer inputs his/her biometrics via a UIDAI compliant biometric reader (e.g. fingerprints on a biometric reader).
- The software application captures the Aadhaar number along with biometric data, encrypts this data and sends it to UIDAI’s Central Identities Data Repository (CIDR).
- The Aadhaar KYC service authenticates customer data. If the Aadhar number does not match with the biometrics, UIDAI server responds with an error with various reason codes depending on type of error (as defined by UIDAI).
- If the Aadhaar number matches with the biometrics, UIDAI responds with digitally signed and encrypted demographic information [Name, year/date of birth, Gender, Address, Phone and email (if available)] and photograph. This information is captured by bank’s e-KYC application and processed as needed.
- Bank’s servers auto populate the demographic data and photograph in relevant fields. It also records the full audit trail of e-KYC viz. source of information, digital signatures, reference number, original request generation number, machine ID for device used to generate the request, date and time stamp with full trail of message routing, UIDAI encryption date and time stamp, bank’s decryption date and time stamp, etc.
- The photograph and demographics of the customer can be seen on the screen of computer at bank branches or on a hand held device of BCs for reference.
The customer can open bank account subject to satisfying other account opening requirements.