Ordinance allows voluntary use of Aadhaar for e-KYC

In a move that could help prepaid payment instrument (PPI) issuers complete the e-KYC process for users before the September 1 deadline, the government has approved promulgation of an ordinance to allow individuals to voluntarily use Aadhaar as KYC document.

The ordinance has the same amendments to the Aadhaar Act as proposed by the Aadhaar and Other Laws (Amendment Bill), 2018, passed in the Lok Sabha last month. However, it later lapsed in the Rajya Sabha.

Verification process
PPIs, including mobile wallets, gift cards and paper vouchers, such as meal vouchers, were not allowed to use Aadhaar as one of the verifying documents for KYC after the Supreme Court, in September last year, upheld Aadhaar’s constitutional validity and barred private companies and banks from using it for identity verification.