Update Aadhaar Card KYC (Process and Benefits)

Aadhaar is a 12-digit unique number issued by Unique Identification Authority of India (UIDAI) after taking a person’s biometric details such as fingerprint and iris scan and demographic information like name, address and date of birth, along with a photo.

An Aadhaar card with the unique Aadhaar number is issued to the individual. It is/can be used as an identity card for various services like opening a bank account, buying a SIM card or registration of various services.

Aadhaar (Know Your Customer) KYC is an important process for the Card holder. It allows various service providers to “know” their customers with ease and thereby access their personal and biometric information. In this process, individuals allow Unique Identification Authority of India (UIDAI) to let their personal information be accessed by the various service providers.
 

What is Aadhaar Card KYC and E-KYC?

KYC (Know Your Customer) is a mandatory procedure that mobile/phone connection companies and financial institutions/companies require their customers to complete.

Aadhaar KYC enables service providers to access necessary information of a person, instantly. Since KYC is an important step for mobile connections and financial institutions, Aadhaar card is an effective, easy and direct way to complete this process. This is because one would not have to provide multiple documents for each proof e.g. identity, address etc. and can be done with one document i.e. your Aadhaar card.

However, verification of the card takes time as an individual would be required to visit the centres in order to submit the card and get it verified. The digital platform - E-KYC comes to rescue in such cases. 

In E-KYC, the various service providers don`t need to visit and verify the documents from the centres. They can easily access the details of the holder directly through UIDAI, since they are already verified, thus making the whole process more effective and less time consuming. Hence, E-KYC is an important and effective step.
 

Aadhaar KYC Process:

As per the Information Technology Act, 2000, E-KYC of any individual is equally significant to any other physical document. Aadhaar E-KYC is also accepted by the Ministry of Finance under the PML (Prevention of Money Laundering) Rules. 

The Aadhaar KYC Process can be completed by following the steps given below:

Step 1. The Aadhaar card is produced before the service provider by the customer. The Aadhaar number is taken into account by the service provider.

Step 2. The authentication is done either through mobile OTP, or through biometric verification.

Step 3. After biometric verification, the details are communicated to UIDAI in order to match this value with the value stored in database for the respective Aadhaar number.

Step 4. If the values match, the user’s credentials will be released to the service provider. These credentials include date of birth, address, photograph, etc.

In such a process, since the information is being provided by the UIDAI, the service providers are assured of the authenticity of the documentation. This is because it has been subject to prior verification by UIDAI itself.
 

Advantages of Aadhaar Based e-KYC :

The e-KYC service of Aadhaar has a number of advantages, as mentioned below:

• Paperless Process : It promotes a completely paperless process. The customers do not have to carry the physical documents. Moreover, the service providers do not have to worry about storing and safeguarding tons of documents provided by the customers.

• Low Cost : e-KYC process is more economical and helps in reducing the maintenance and overall operational expenses.

• Less time-consuming : As the information of the Aadhaar card holder can be shared with the service providers within minutes (that too through a secure channel), the long waiting periods that physical documents normally require are eliminated. 

• Easy accessibility : Any service provider can store their customers’ information on one server which can be accessed anytime as per their needs.

• Safe and Secure : Holder’s information is protected, since UIDAI shares only tamper-proof digital documents, that too through secured channels. Moreover, these documents cannot be used without the consent of the Aadhaar holder/Service provider. As human intervention is limited in e-KYC, the whole process gets more secure and less prone to frauds and mistakes. The possibility of submitting forged documents is also eliminated as the details are forwarded by UIDAI in the form of tamper-proof digital copies.  The holder is thus also unable to provide any wrong/fraud details.