Finance Ministry Allows Aadhaar-Based Verification for Central KYC [Read Notification]

The Ministry of Finance (Department of Financial Services) has issued Notification No. S.O. 5034(E) dated November 6, 2025, allowing the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI), which operates the Central KYC Records Registry (CKYCRR), to use Aadhaar-based authentication for verifying the identity of individuals.

The decision was published in The Gazette of India and approved after consultations between the Ministry of Electronics and Information Technology (MeitY) and the Unique Identification Authority of India (UIDAI). It is supported by the Aadhaar Act, 2016, and the Aadhaar Authentication for Good Governance Rules, 2020.

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Under the new system, CERSAI, acting as the CKYCRR, can use Aadhaar authentication to confirm basic personal details such as name, date of birth, and address.

This will help banks, insurance companies, mutual funds, pension funds, and other financial institutions that are regulated by the Reserve Bank of India (RBI), Securities and Exchange Board ofIndia (SEBI), Insurance Regulatory and Development Authority of India (IRDAI), International Financial Services Centres Authority (IFSCA), and Pension Fund Regulatory and Development Authority (PFRDA).

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The Finance Ministry has made it clear that using Aadhaar for verification will be voluntary. No person can be forced to provide Aadhaar details, and no financial service can be denied if someone chooses not to use it.

In such cases, customers can use alternative identity documents like a passport, driving licence, voter ID, NREGA job card, or a letter issued by the National Population Register (NPR) that includes their name and address.

This decision will make the process of verifying customers’ identities much more convenient and efficient. It will reduce the need for multiple documents and help prevent duplication in financial records. This move will also strengthen India’s compliance framework under the Prevention of Money Laundering Act (PMLA), 2002, since verified data will flow securely between institutions.

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