With a kind of stalemate in the process of digital verification of new customers by the different players in the financial sector, the industry has now approached the Reserve Bank of India with its own suggestions on how to resolve the issue if Aadhaar is not to be the only identity method for the eKYC verification.
After the landmark judgement by the Supreme Court more than four months ago that the banks and other financial institutions cannot insist on Aadhaar as the only available ID proof to complete the eKYC process, there has been hardly any progress made. Any other physical verification method proves to be highly expensive for these institutions. It is pertinent to point out that the Parliament (only Lok Sabha) has passed a legislation on this, but it excluded the other fintech bodies.
Now, the remedy for this stalemate is being offered by the body called Digital India Collective for Empowerment (DICE) and another that goes by the name Digital Lenders Association of India (DLAI).
One suggestion is to have a video verification; this is by DICE and they are still seeking clarity on the other processes which were suspended following the SC order. DICE has suggested that for offline KYC, an Aadhaar-linked QR code could be used. RBI appears to be favourably inclined to consider these suggestions, though only discussions are underway.
Some of the institutions and individuals who have signed on the communication to the RBI include Bank Bazaar, SBI Cards and Payments Services Ltd and Eko India Financial Services.
The other body DLAI mentioned above also has been working on this digital KYC space and boasts of 55 members in its organisation.
They are all collectively trying to impress upon RBI that the eKYC is the best process for onboarding new customers either for accounts opening purposes or for loan disbursal purposes. They believe it becomes easier to cover a larger geography at limited cost and the availability of internet connected telephones even in rural areas makes it secure and the best.