Accordingly the Central Government’s directive on making Aadhaar compulsory for KYC by banks was contested and the matter went to the Supreme Court. Meanwhile the Court gave some mixed orders and the ball was in RBI’s court to give the appropriate directions to the banks so that the KYC norms could be met and this has now been done by the regulator.
Furthermore as per the Master Direction, the Reserve Bank of india has said banks can carry out Aadhaar authentication, or offline verification, for individuals who voluntarily opt for it. Meanwhile it has permitted offline KYC as a new means of user verification with customer’s consent and banks are bound to follow these directives. Further the distinction being made is between those bank customers who avail the benefits such as direct benefit transfers of subsidies etc. and those who have opted out of those subsidies.
Moreover if the process is adopted then the accounts can maintain a maximum balance of only Rs. 1 lakh and if the account is opened by a bank through one time password, face to face verification has to be completed within one year.
