KYC norms: RBI makes Aadhaar-bank accounts linking mandatory

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April 21, 2018

The Reserve Bank of India (RBI) Friday amended its KYC (know your customer) norms making linking of 12-digit Aadhaar number to bank account compulsory.

RBI has made the Aadhaar key mandatory for conducting Customer Due Diligence (CDD) by banks and finance companies. CDD refers to identifying and verifying the customer and the beneficial owner.

The RBI’s new direction comes at a time when the Supreme Court is in the final stage of hearing petitions challenging the validity of Aadhaar.

However, the central bank states that these guidelines were subject to the verdict in the Supreme Court. “The revised Master Direction is in accordance with the changes carried out in the PML Rules vide Gazette Notification GSR 538 (E) dated June 1, 2017, and thereafter and is subject to the final judgment of the Hon’ble Supreme Court in the case of Justice K.S. Puttaswamy (Retd.) & Anr. V. Union of India, W.P. (Civil) 494/2012 etc. (Aadhaar cases),” RBI said in a statement while updating its master direction on KYC norms.

The Supreme Court on March 13 extended the deadline for Aadhaar linking with bank accounts and mobile number indefinitely till the Constitution Bench of the apex court delivers its verdict in all cases regarding the validity of the Aadhaar program.

The interim order was passed by a five-judge Constitution Bench comprising Chief Justice Dipak Misra and Justices A K Sikri, A M Khanwilkar, D Y Chandrachud and Ashok Bhushan.

Earlier, March 31 was set as the deadline for Aadhaar linking with the bank account and mobile number. The court observed that Aadhaar is needed only for availing benefits of social schemes for the time being. The extension of the deadline was not applicable to services including bank accounts, tatkal passports, and mobile numbers.


Courtesy/Source: IB Times

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