The E-commerce company Paytm, has launched an electronic, Aadhaar-based client authentication system in an attempt to help upgrade its digital wallet customers. With this, digital wallet customers and account holders of its upcoming payment bank will be able to carry out transactions exceeding 10,000 INR a month. It will use Aadhaar-based electronic know-your-customer process (eKYC) to verify users’ credentials.
Aadhaar-based eKYC process allows for verification of a customer’s identity through fingerprints and iris scans which are then authenticated with biometrics recorded in Aadhaar database. This is a part of an initiative called India Stack. It allows third-party entities to use Aadhaar for authentication, digital signatures through eSign, a unified payment interface and privacy-protected data sharing.
eKYC provides instant verification of a customer’s identity and address on the basis of fingerprint or iris scans from the database and authenticated. Paytm will also capture a customer’s consent using the Aadhaar-based e-sign, ensuring that the entire process is paperless. This will indeed ease out the process and will open up various new opportunities. Paytm CEO stated that, with eKYC, the Paytm payment bank will have a great start with an Aadhaar-linked savings account. It also helps us build superior AML (anti-money laundering) and fraud protection. This is made possible as each and every customer is biometrically verified.
Recently have been seeing a lot of integration with Aadhaar-based eKYC authentication. Various telecom service providers like Airtel, Vodafone and the recently launched Reliance Jio also announced that the new connections can be activated using the eKYC authentication. Paytm was among the 11 entities that received payment bank license from the Reserve Bank of India last year. This will not only allow instant or near instant activation, but it will also enable paperless work and will ease out the overall process. We expect more and more services use this and enable an overall simple procedure to the users.