What is Aadhaar e-KYC: Online Process, Benefits and Organization’s Using It
With an objective to improve customer service and user experience, the Unique Identification Authority of India (UIDAI) introduced the Aadhaar card e-KYC process. Generally, financial institutions and mobile companies ask their customers to complete the KYC or Know Your Customer process.
Previously, the verification of personal information used to take a long time due to the heavy paperwork. But now, the UIDAI enables service providers to electronically verify their customers’ personal details. This paperless process is less time consuming and makes it convenient for individuals when opening new bank accounts or availing of new mobile connections.
Stick around to know more about Aadhaar KYC.
Aadhaar e-KYC Online Process
One can initiate the process of KYC for Aadhaar online by following the below-mentioned steps:
- Step 1: Present your Aadhaar card to your respective service providers who will note down your 12-digit Aadhaar number.
- Step 2: In the next step, biometric scanning of your fingerprint or retinal image will take place. Alternatively, you can go for a mobile-based OTP authentication process.
- Step 3: Now the biometric data is sent to the UIDAI, where it will be matched against the stored value in their database.
- Step 4: Once this data matches, one can safely assume your identity is not suspicious.
- Step 5: After successful identity verification, the UIDAI will send all details such as addresses, birth date, photographs etc., to service providers. Thus, you need not carry documents for verification.
- Step 6: Service providers will store your credentials in their database and access them as and when required.
Impact of Aadhaar e-KYC
The process of Aadhaar e-KYC is not only beneficial for customers, but service providers as well take advantage of this procedure as it reduces heavy paperwork. Owing to this, the number of parties enrolling for Aadhaar has also increased in the country. While availing of various services, individuals need not furnish multiple documents for KYC.
Similarly, service providers do not need to store those documents in their database, which brings down the cost of maintenance and operations. They can store these data on a single server and access them any time they want. Since there is minimal human intervention, the entire procedure remains secure and less exposed to fraud.
Thus, the online Aadhaar card KYC process is efficient and saves substantial money and time.
Advantages of Aadhaar e-KYC in India
1. Completely Paperless
The electronic verification process eliminates the need for customers to provide hard copies of documents. This enables service providers to manage the verification process seamlessly and efficiently.
2. Expect Data Security
The UIDAI will send digital documents to providers through secure tunnels, ensuring zero chances of data tampering. Thus, a cardholder’s identity remains intact, and there are slim chances of document forging. Further, one cannot use these documents without a service provider or Aadhaar holder’s consent.
3. Experience a Consent-based Process
Any sharing of information with service providers will take place only after a customer’s consent. The UIDAI accepts this consent as an OTP authentication or through biometric verification.
4. Expect No Chance of Forgery
The UIDAI shares only authentic data that makes it acceptable for service providers.
5. Enjoy a Cost-effective Process
The physical movement of information can increase the costs due to the involvement of multiple documents. Thus, this paperless KYC process is cost-efficient.
Also Read
Organizations Using e-KYC
- Financial institutions
- Mutual fund companies
- Trading accounts
- Insurance companies
- LPG service providers
- Stockbrokers
- Railway authorities
- Stock exchanges
- KYC registration agencies
Final Word
It is evident that Aadhaar e-KYC offers instant identity verification at lower costs compared to the traditional paper-based KYC. As the Know Your Customer process is mandatory across several service providers, the e-KYC procedure can be beneficial for both customers and organisations. Thus, individuals planning to avail of different financial services can consider referring to this piece for detailed information.
FAQs
Ans: The procedure of Aadhaar e-KYC might not be present in all agencies due to the following reasons:
Absence of reliable connectivity
Insufficient technical infrastructure
Residents might need to provide biometrics, and the respective agency might lack equipment for the same
Maintenance of KYC requests records for audit purposes can be tedious
Ans: The UIDAI introduced an offline and paperless Aadhaar e-KYC process enabling cardholders to opt for paperless and electronic KYC by maintaining privacy, inclusion and security. Furthermore, in this procedure, one does not need to provide an Aadhaar letter photocopy as they can download KYC XML and submit it to the service providers who ask for KYC.
Ans: The compulsory fields available in KYC XML while obtaining paperless offline Aadhaar e-KYC data are as follows:
Name of the resident
Download reference number
Here are the optional fields:
Photo
Address
Gender
Date of birth or year of birth
Email
Mobile number
Ans: Currently, individuals can obtain offline Aadhaar e-KYC data by visiting UIDAI’s resident portal. However, the data might also be available through the mAadhaar mobile application, inbound SMS using registered phone numbers, and Aadhaar Kendra using biometric identification in future.
Ans: Aadhaar holders can share e-KYC data to verifying agents in the following ways:
Digital format (PDF/XML): This format is recommended when high-quality photos are required.
Print format (QR code): Residents comfortable with physical formats can opt for this format. Furthermore, customers can share this format with those agents who ask for low-resolution photos that are only necessary for visual inspection.
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This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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