What changed
RBI has recognized UIDAI's e-KYC service as a valid process for KYC verification under PMLA Rules, allowing UCBs to accept electronic demographic data and photographs from UIDAI as an Officially Valid Document. This expands on the earlier acceptance of physical Aadhaar letters. UCBs must now sign a KUA agreement with UIDAI and deploy STQC-certified biometric scanners to use this service.
What it means for you
UCBs can now onboard customers with fully digital, paperless KYC using Aadhaar biometric authentication, reducing document forgery risks and operational costs. This streamlines customer onboarding but requires upfront investment in certified hardware and software. Banks must update their KYC policies to incorporate e-KYC as a valid verification method.
What you must do
- Sign a KYC User Agency (KUA) agreement with UIDAI to access e-KYC services.
- Deploy STQC-certified biometric scanners at branches, micro ATMs, and BC points as per UIDAI standards.
- Develop or integrate software to enable e-KYC across all customer service points.
- Update your bank's KYC policy to include e-KYC as an accepted Officially Valid Document.
- Ensure explicit customer consent is obtained before biometric authentication for e-KYC.
Who it affects
Primary Urban Co-operative Banks (UCBs), Bank branches and business correspondents (BCs), Customers opening accounts with Aadhaar-based verification
Can we still accept physical Aadhaar letters after this circular?
Yes, physical Aadhaar cards or letters issued by UIDAI continue to be accepted as an Officially Valid Document. The e-KYC option is an additional, paperless alternative.
What hardware is required for e-KYC implementation?
UCBs must deploy biometric scanners that are STQC-certified by the Department of Electronics & Information Technology. The circular provides a link to the current list of certified scanners.
Do we need customer consent for e-KYC?
Yes, the individual user must explicitly authorize UIDAI to release their identity/address through biometric authentication to the bank or BC. This consent is mandatory.