No RBI directive on Aadhaar linking of bank accounts, reveals RTI reply

A woman gets her iris scanned while registering for an Aadhaar number. The UIDAI had on July 14 asked banks to open Aadhaar enrolment and updating facilities in at least one-tenth of their branches by the end of August

No RBI directive on Aadhaar linking of bank accounts, reveals RTI reply

Mumbai: The Reserve Bank of India on Saturday in a statement mentioned that linking the Aadhaar number with bank accounts is mandatory.

The confusion was caused by the RBI's reply to an RTI query, which stated that it had not issued any circular/notification to bankers to seed Aadhaar details with bank accounts, but that the Centre had issued the order to curb money laundering.

It added that these rules have "statutory force" and banks have to implement them without awaiting further instructions.

Sen's petition, filed through advocate Vipin Nair, said the government's decision to link Aadhaar with bank accounts by amending rules under PMLA violate the solemn promise given by the authorities that parting of biometrics by individuals was on a voluntary basis. In its reply RBI said it had not filed any such petition before the Supreme Court. The deadline to do it is December 31, 2017.

However, the banks started pushing for Aadhaar and bank accounts to be linked since June when an official government notification said that if customers failed to link Aadhaar to bank accounts the latter would be invalidated.

The query also explicitly asked if the apex bank had taken permission from the Supreme Court for mandatory linking of bank accounts with Aadhaar. "It may be noted that Reserve Bank has not yet issued instruction in this regard".

The response indicates that the choice on obligatory connecting of bank accounts with Aadhaar originates from the central government alone and not the RBI. In a note to the government and the RBI, IBA has said that under the Banking Regulation Act, only the RBI is empowered to issue directives to banks.

In an earlier statement in 2016, Venkaiah Naidu, Minister for Information and Broadcasting said, "Use of Aadhaar will eliminate corruption, ensure hassle-free and faster and direct delivery of benefits into bank account, or in kind, without any intermediaries and diversions". The notification issued amending the Prevention of Money- laundering (Maintenance of Records) Rules, 2005, mandated quoting of Aadhaar along with PAN or Form 60 by individuals, companies and partnership firms for all financial transactions of Rs 50,000 or above.

José Mourinho: 12 matches, 10 wins, 9 clean sheets: we're not bad
Red Wings, Andreas Athanasiou agree to one-year deal