Business Economy 21 Oct 2017 UIDAI can't iss ...

UIDAI can't issue orders to us, only RBI can: Banks write to govt

DECCAN CHRONICLE
Published Oct 21, 2017, 1:11 pm IST
Updated Oct 21, 2017, 1:11 pm IST
In July, the UIDAI had asked private as well as public banks to open Aadhaar enrolment and updation facilities.
The Indian Banks’ Association (IBA) has questioned the UIDAI's authority in directing banks under the Aadhaar Act. (Photo: AFP)
 The Indian Banks’ Association (IBA) has questioned the UIDAI's authority in directing banks under the Aadhaar Act. (Photo: AFP)

Mumbai: While Aadhaar-issuing body Unique Identification Authority of India (UIDAI) has been coercing banks to open enrolment and updation centres, the Indian Banks’ Association (IBA) has questioned the nodal body’s authority in directing banks under the Aadhaar Act, said media reports.

In a letter to the ministry of electronics and information technology, the Reserve Bank of India (RBI) and the department of financial services, the IBA said that only the RBI has the authority to issue directives to banks under the Banking Regulation Act, sources told Mint.

 

This report comes just a day after the UIDAI said only about 2,300 branches of private and public sector banks have opened Aadhaar enrolment and updation centres within their premises as against the targeted 15,300 branches by October-end.

The Aadhaar-issuing body previously extended, till October 31, the deadline for banks to open Aadhaar enrolment and updation centres in at least 10 per cent of their branches.

In July, the Unique Identification Authority of India (UIDAI) had asked private as well as public banks to open Aadhaar enrolment and updation facilities. Later, it extended the deadline by a month and said it would impose a penalty of Rs 20,000 per uncovered branch after September 30.

 

According to a copy of a circular seen by Mint, the Aadhaar centres shall be operated by banks directly inside branch premises without involvement of any private Aadhaar enrolment agencies.

The IBA in its letter also drew attention to issues associated with banks creating an Aadhaar database and using it for KYC purposes. “Aadhaar enrolment is not the primary role of banks. We are awaiting clarity from both RBI and government whether we should take directives from an external authority to do Aadhaar enrolment as part of banking activity,” a source told the paper.

 

Meanwhile, the UIDAI has also been emphasizing on the linking of banks and Aadhaar numbers, the deadline for which is December 31. In an RTI reply, the RBI however revealed that it “has not issued any instruction so far regarding mandatory liking of Aadhaar number with bank accounts."

These issues raise questions regarding the authority controlling Aadhaar and the extent of its jurisdiction in legal terms.

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