Use of Aadhaar authentication by Private Parties
Date Published
The Supreme Court has held that the provision in Section 57 of the Aadhaar Act that enabled the use of Aadhaar Authentication by private parties was unconstitutional as such use allowed private parties to commercially exploit the biometric and demographic information.
The court further held that any other use of Aadhaar Authentication must be backed by law and prohibited the use of Aadhaar Authentication under a contract. However, the Aadhaar card can be presented as proof of identity, if the cardholder chooses to do so. Consequent to the judgment, banks, and telecom service providers who met their KYC obligations under law by using
Aadhaar-enabled e-KYC can no longer do so. It’ll have a far-reaching impact on the burgeoning financial services industry – especially new-age fintech, which will struggle to keep their transactional costs low and turnaround times fast without Aadhaar e-KYC.
Read Physical KYC = Rs. 85 lakhs more and 821 years longer! Click hereKnow more about IDfy solutions here.
Just two operational segments in banking contribute to a whopping 95% of all banking frauds. That’s right — Advances and Cards/Internet banking — together account for 95% of all banking frauds. All other operational segments like forex, deposits, cash, cheques, and clearing accounts are tiny problems, in comparison, accounting for less than a percent of total banking frauds.
It had been raining for three straight days in Shillong, and Uday Imtisong was making his third trip between the bank and his house since that morning. Wading through knee-deep water, he wondered if his loan application would be approved anytime soon so that he could add a new wing to his popular gymnasium. He worried about his woefully inadequate credit history and his inability to provide a land bank as collateral for his loan – a common expectation from the lending officer at the bank.
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