Aadhaar made mandatory for opening bank accounts & for financial transactions over INR 50,000

  • If you are looking to open a bank account you will now have to furnish Aadhaar number along with Permanent Account Number (PAN). Further, you will also need Aadhaar for any financial transaction of INR 50,000 or above. Existing bank holders are required to furnish their Aadhaar numbers by December 31, 2017. Failure of this deadline will make such accounts cease to operate.

    Revenue Department issued a notification amending the Prevention of Money-Laundering (Maintenance of Record)Rule, 2005 mandates quoting of Aadhaar along with the PAN or  Form 60, by individuals, companies and partnership firms for all transactions of INR 50,000 or above from June 1.

    The threshold of INR 50,000 includes investments in mutual funds, fixed deposits, insurance etc. These rules also tighten the reins over operation of small accounts such as those opened under Pradhan Mantri Jan Dhan Yojana which has less stringent know your customer (KYC) rules. These Jan Dhaan accounts can only be opened at branches that have core banking solution or at a branch where it is possible to manually monitor and ensure that no foreign remittances are credited to such accounts. Further, these accounts will also have a monthly and an annual aggregate limit of transactions.

    These rules will be applicable to corporate entities as well. For companies, opening bank accounts Aadhaar number of managers, or employees holding an attorney to transact on the company's behalf will have to be provided.

    This is an another crucial step taken by the government in furtherance of its aim to unearth black money from the economy like demonetization and the Benami law.

    Visit the Indian Kanoon section of LawRato to learn more on Indian Laws.

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