Aadhaar Made Compulsory For Opening Bank Accounts & Transactions Over Rs 50,000

The Logical Indian Crew

June 16th, 2017 / 5:50 PM

Image Credit: Patrika, Hindustan Times | Source: bloombergquint

The government has issued new regulations through a revenue department notification. The rules expand the purview of Aadhaar, which is a 12-digit identity number with biometric data currently enrolled by over 99% of Indians aged 18 and above.

The new regulations include the following provisions:

  1. Aadhaar card compulsory for opening a new bank account;
  2. Aadhaar card compulsory for financial transactions above Rs 50,000;
  3. Existing bank accounts will become invalid if account holders don’t submit their Aadhaar ID by the end of this year.

In this year’s Budget, the government mandated the seeding of Aadhaar with a citizen’s Permanent Account Number (PAN) to prevent individuals exploiting multiple PANs to evade taxes.

The notification, which was issued amending the Prevention of Money Laundering (Maintenance of Records) Rules, 2005, mandated the quoting of Aadhaar along with PAN or Form 60 by individuals, companies and partnership firms for all financial transactions of Rs 50,000 and above.

Furthermore, the amendment sought to tighten the rules for small accounts that can be opened without having officially valid KYC documents by stating that such accounts (which can have maximum deposit of Rs 50,000) can only be opened at bank branches which have core banking solutions.

The revenue department notification read: “The small account shall be monitored and when there is a suspicion of money laundering or financing of terrorism or other high risk scenarios, the identity of claim shall be established through the production of official valid documents.”

Additionally, from today if a person applying for a bank account does not have an Aadhaar card they will be required to submit proof of application for Aadhaar and submit their Aadhaar number within six months of opening of bank account.

Commenting on the development, Nangia & Co Managing Partner Rakesh Nangia was quoted by Bloomberg Quint as saying, “With the amendment, obtaining Aadhaar and PAN have gained paramount importance, since the banks are now required to report Aadhaar and PAN in respect of each of its clients’ at the time of account opening and in case of existing accounts at the time of making transactions worth Rs 50,000 or more.”


The new rules come in light of renewed controversy surrounding the constitutional validity of indirectly mandating Aadhaar, disagreement between the government and the Supreme Court over Aadhaar’s expansion, cybersecurity concerns, and potential for abuse of Aadhaar data by governmental and foreign institutions.


Contributors

Written by :

Edited by :

Related Stories

Supreme Court Refuses to Disqualify Netas With Criminal Cases

Aadhaar Not Needed For Opening Bank Accounts, SIM But Mandatory For PAN Card: SC Verdict

Aadhar Card Scam Uttar Pradesh

UP: Using ‘Fake’ Aadhaar Cards, 1.86 Lakh Transactions Done To Steal 2.2 Lakh Tonnes Of PDS Supply

Taking A Stand: Chess Grandmaster Pulls Out Of Iran Tournament Over Compulsory Headscarf Rule

Supreme Court Aadhar Mobile

Govt Accepts Supreme Court Never Made Linking Aadhaar to Mobile Compulsory

Aadhaar-Linked Accounts Of 5 Customers Breached, Over Rs 5 Lakh Swindled Off: Arun Jaitley In Lok Sabha

Demonetisation

Fake Shell Company With 2,000 Bank Accounts Transacted Rs 4,000 Crore; Reveals Demonetisation

Latest on The Logical Indian

News

Victory For India In Kulbhushan Jadhav Case, Know All About It

News

Ebola Claims Over 1,600 Lives, WHO Declares Outbreak ‘An International Health Emergency’

News

Bombay High Court Convicts One In British Teenager Scarlett Keeling Murder Case

News

AP: Amid Drinking Water Crisis, 38-Yr-Old Woman Killed During Clash At A Public Tap

News

Safety Management System Of 5 Airlines Found Deficient By Aviation Regulator: Govt

Get Inspired

Bihar Govt Establishes Transgender Welfare Board, To Give Rs 1.5 Lakh For Sex Change Operation

x

Stories that deserve attention, delivered to your inbox!

Handpicked, newsworthy stories which deserve the attention of a rational generation.