Aadhaar-based id verification: UIDAI plans simplifying offline Aadhaar for citizen KYC; push for safer, user-friendly course of
The Distinctive Identification Authority of India (UIDAI) is taking steps to bolster the offline Aadhaar-based id verification course of, aiming to make it safer, user-friendly, and extensively adopted throughout monetary and fintech companies, as per two senior bankers.
What’s the key goal?
The important thing aims of UIDAI’s newest transfer are to permit Aadhaar-based KYC to be accomplished with out requiring residents to share their Aadhaar quantity or private particulars, thereby enhancing privateness and safety, ET reported.It additionally goals to simplify the offline id verification course of by selling the usage of QR codes and PDF codecs, making it simpler for customers to handle and share their identification paperwork. Moreover, the initiative is concentrated on encouraging startups and monetary service suppliers to undertake compliant and controlled verification strategies by integrating with authorised businesses.
Why the Change?
The transfer comes amid issues about unauthorised entry to Aadhaar knowledge. In June, the UIDAI and the Ministry of Electronics and Data Know-how (MeitY) blocked a number of startup web sites for allegedly accessing Aadhaar info illegally. These disruptions hit a number of sectors, together with fintech, meals supply, and e-commerce, the place Aadhaar was extensively used for verifying gig employees and blue-collar workers.Many fintech and non-banking lenders confronted onboarding delays as they relied closely on Aadhaar for buyer verification.“There have been a number of rounds of conversations, and UIDAI has made it very clear that buyers will have the ability to use offline Aadhaar-based KYC with none must share their Aadhaar quantity or private particulars,” one of many bankers advised ET.The UIDAI is working to manage and streamline the method by means of approved entities like Aadhaar Authentication Businesses and KYC Consumer Businesses.
What’s New?
- UIDAI will promote QR codes and PDFs for offline KYC as an alternative of the present XML-based technique, making it simpler for customers to share and handle paperwork.
- Offline Aadhaar-based KYC will not require biometric authentication or OTP, easing entry for customers in distant areas.
- The method should be completed with buyer consent solely.
The UIDAI gives three KYC choices:
- Digital KYC (OTP-based): Requires sharing Aadhaar quantity, and is usually utilized by banks and insurers.
- Biometric KYC: Requires in-person verification.
- Offline KYC (XML technique): Customers obtain a knowledge file from UIDAI to share with service suppliers.
“The issue was with the offline technique, the place many startups had been offering this verification service by means of unauthorised means. UIDAI is coming down arduous on gamers who’re providing non-compliant offline KYC flows,” the founding father of an id verification startup stated.With UIDAI clarifying norms and simplifying offline verification, extra banks and fintechs are anticipated to undertake it. Identification verification startups at the moment are trying to combine compliantly by partnering with approved businesses, guaranteeing continued service whereas adhering to rules.As the federal government tightens controls and improves usability, offline Aadhaar KYC is more likely to play an even bigger function in digital id verification throughout India’s increasing monetary ecosystem.
