The Ministry of Finance has notified the “e-KYC setu” with an aim to prevent money laundering activities.
A notification issued on Wednesday stated that the entities onboarded to perform authentication under the Aadhaar Act, 2016 for the purposes of section 11A of the Prevention of Money-laundering Act, 2002 using the e-KYC setu system be permitted to do so, after being satisfied that the e-KYC setu system complies with the standards of privacy and security under the Aadhaar Act.
The e-KYC setu shall be a system put in place by National Payments Corporation of India (NPCI) to enable verification of identity of a client or its beneficial owner by a reporting entity through authentication under the Aadhaar Act without disclosing the Aadhaar number of the individual to the reporting entity.
NPCI shall ensure that the authentication is carried out using the Aadhaar number of the client as per the regulations laid down by UIDAI, without disclosing full Aadhaar number to the reporting entity, and after carrying out authentication, NPCI shall share the last four digits of the Aadhaar number of the client, alongwith his demographic details made available to it by UIDAI, digitally signed by it, with the reporting entity and the reporting entity shall carry out identification of the client based on the details provided by the client and NPCI.
“UIDAI may carry out such verification, including physical verification, as it may deem fit to ensure that the system put in place by NPCI is in compliance with the regulations issued by them and the requirements laid down by them and in case the UIDAI comes to a conclusion that additional measures are required to bring the system in compliance with regulations and other requirements, if any, it may issue such directions to be complied with in such time as it may deem fit,” the notification said.
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