Ban on Access to Adhaar is affecting Fintech
05th, April 2018 - FinTech
Fintech companies in India in Insurance, Broking and other related industries are started raising concenr over not able to access to authenciate the customer profile.
Source says that although there is no written directive to the authentication agencies from the Unique Identification Authority of India (UIDAI), they have been unable to access these services since the Supreme Court made critical observations around multiple unregulated entities accessing the database during the hearing on privacy concerns around Aadhaar.
UIDAI said they have stopped allowing private unregulated entities from using the Aadhaar database for authentication of their customer base till further notice from UIDAI. This has been done on the basis of the Supreme Court observation on March 27. This move is affecting many players ion Fintech as they as not able the authencate their cusomter profile and provide their services.
Typically, the fintech industry, which offers a slew of services, has relied on access to the Aadhaar database for quick customer verification. They relied on the network of AUAs registered with UIDAI as well as sub-AUAs to access this service. Since Adhar give the data of customer, Fintech’s cost on their services reduced drastcially and thye were able to serve the poor at a least cost with minimum margins.
This move from UIDAI is observed when Finteh business are growing and they are getting multple application for the grant of the acces.
As per data shared by UIDAI, the number of eKYC transactions that have happened till now stands at 504 crore, being done through 254 authentication agencies. Also, almost 18 billion authentications for customers have been done till date
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