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Take UID, get bank account

delhi Updated: Feb 04, 2010 02:06 IST
Chetan Chauhan
Chetan Chauhan
Hindustan Times
Take UID

A bank account free with unique identification number — is how the government plans to sell its plan for creating a database of all residents.

To ensure that every Indian has a unique identification number (UID) within five years of the rollout — launch is expected in December — the government will open a savings account in a nationalised bank with a deposit of Rs 100.

The Unique Identification Authority of India has sought Rs 25,000 crore for the incentive. An announcement is likely in the Budget to be presented on February 26.

“I cannot confirm or deny the proposal,” director general of the authority R.S. Sharma told HT. “It is being felt that half of Indian population will not opt for the UID, if there is no financial incentive,” said a senior government official, who didn’t wish to be identified as he is not authorised to speak to the media. A UID is not mandatory.

“Through UID we aim to bring all residents into formal banking network. It'll eventually help in tracking black money in a better way,” the official said. According to government estimates half of the country’s population is unbanked.

In its proposal, the authority has said each number will cost the government Rs 200. Half the money will be for the services of private vendors and remaining will be the opening balance for the applicant's account. Private vendors will be given work through the authority's regional offices, which are functional.

There could be some grant for the incentive in the Budget, a Plan panel official said on condition of anonymity. “The finance ministry has to take the final call.”