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Telecom companies get 15 days to submit Plan B on authentication without Aadhaar

UIDAI has asked telecom companies to submit plan for discontinuing Aadhaar-based authentication system for mobile SIMs.

india Updated: Oct 01, 2018 23:12 IST
HT Correspondent
HT Correspondent
Hindustan Times, New Delhi
UIDAI,Aadhaar,Aadhaar for mobile
The Supreme Court ordered that the government could not make the Aadhaar number a condition for operating bank accounts, mobile phones and school or college admissions.(Mint file photo)

The Unique Identification Authority of India (UIDAI) asked telecom companies on Monday to submit within the next 15 days a plan to stop using Aadhaar for customer authentication, days after the Supreme Court said private entities could not demand from citizens the 12-digit unique ID number.

A circular to this effect has been issued to telecom service providers (TSPs), including Bharti Airtel, Reliance Jio, and Vodafone Idea, among others.

“All TSPs are called upon to immediately take actions in order to comply with the judgement dated 26.09.2018. In this regard, TSPs are hereby directed to submit by 15th October, 2018 an action plan/exit plan to the authority for closure of use of Aadhaar based authentication systems...” said the circular.

Private companies which used Aadhaar authentication as part of their electronic infrastructure, have been affected.

These companies relied on the UIDAI database for doing e-KYC (know-your-customer).

An official for a body that represents telecom operators said they might not take any action for now since such directives need to come from the department of telecommunication (DoT). “We get our orders from DoT. We will wait for the DoT to tell us what’s the best way forward,” said Rajan Mathews, director general of Cellular Operators Association of India.

“When UIDAI told us to go with face recognition, DoT came back and said don’t do it until we give you instructions,” he said, referring to the protocol that operators follow.

According to an industry expert, who spoke requesting anonymity, the move will force private companies to move from an online authentication model to an offline one, which would be both more expensive and time consuming.

“It could increase the cost of authentication from ?15 per person, which is the current cost of e-KYC verification, to ?100 per person for a physical KYC,” the person told a Mint correspondent.

In the offline model of authentication, companies have to collect physical paper forms with signature, photographs, ship to verification centre and call up the customer to cross-verify submitted details – a process that takes around 24-36 hours to verify a customer.

“In order to ensure smooth discontinuation... there are certain requirements which are there under the Aadhaar regulations... so the companies are in the best position to know what exactly is needed and they can submit their plan by October 15. If any additional requirements are to be done from the UIDAI’s side, we will tell them after receipt of their plan,” UIDAI chief executive officer (CEO) Ajay Bhushan Pandey told PTI.

Other than telecom companies, fintech companies selling loans, mutual funds and insurances, digital payments companies and payment banks have been severely impacted with the apex court’s judgment, which included the scrapping of section 57 of the Aadhaar act — the portion of the law allowing private entities access to the Aadhaar database.

“That portion of section 57 of the Aadhaar act, which enables body corporate and individuals to seek authentication is held to be unconstitutional,” a five-member Constitution Bench headed by Chief Justice Dipak Misra said in its judgment on September 26.

The digital payments industry may lobby with the finance and law ministries to formulate a law that will allow them access to the biometric database, Vishwas Patel, chairman of Payments Council of India (PCI), the industry body that represents all digital payments companies in India, told Mint.

(With inputs from Mint and PTI)

First Published: Oct 01, 2018 15:10 IST