Are the Aadhaar details adequate for opening a bank account?
A first account of an attempt to open a bank account using the aadhaar card is put up below alongwith comments by a reader.
The Chairman and all officers of
Unique Identification Authority of India
Planning Commission, Government of India
3rd Floor, Tower II, Jeevan Bharati Building, Connaught Circus
New Delhi - 110001
Dear Sirs / madam,
This is a personal account of my attempt to find some Aaddhaar (basis) for the claims being made by senior officers of the Unique Identification Authority of India (UIDAI) about the enormous convenience it creates for citizens.
As always, I have been lax in tending to matters familial. So after my mum reminded me for the umpteenth time today, to get her passbook updated (overdue for more than six months) I gulped down the delicious anda burji and rotis she had made for breakfast and scooted to the bank. The Canara Bank, a public sector bank has been running a branch in Malviya Nagar since several years and being Kannadigas we are sort of biased in favour of this one which is headquartered in Karnataka. As I waited for the clerk to print the latest details of my mom’s passbook I chanced upon a big poster that extolled the virtues of possessing an Aadhaar identity to avail oneself of the various subsidy schemes being implemented by the government. Memories of a month-old debate on one of the TV channels in which I took part about the usefulness of Aadhaar resurfaced. On that show the Deputy Director General of UIDAI had rubbished my allegation that banks continue to insist on identity and residence proof for opening bank accounts. He cited a circular of the Reserve Bank of India which apparently says “Aadhaar details are enough", to rebut my claim. Thus started my quest to check the veracity of UIDAI’s claim that Aadhaar details are enough to avail all subsidies from government through direct benefit transfer through banks. I visited 10 banks in my area to cross check UIDAI’s claims that Aadhaar is enough to open bank accounts let alone avail myself of subsidies. These are my findings:
Canara Bank: After being referred from desk to desk which is the usual story of public sector offices that do not have a “May I Help You” counter, I landed up before a senior officer and asked him if Aadhaar details are enough to open a bank account. The banker who does not know me as I rarely visit the branch, smiled at me and said “You must have a minimum balance of Rs. 50,000/-“. Ahem! If I can maintain such a monthly/quarterly balance after covering all my expenses, would I even want a subsidy? He assured me that I could open an account if I was introduced by an existing customer who held an account for more than six months. Regretting my decision not to join the corporate sector two decades ago when I had the chance, I walked to the next bank which is a few shops away.
Vijaya Bank: This public sector bank’s official told me that along with Aadhaar details I would still need an introducer who has been operating an account with the Bank for more than six months. The minimum balance required to be maintained however is Rs. 1,000/-. That cheered me up as the pecuniary requirement was well within my reach. But I wanted to test it out with some more Banks.
Syndicate Bank:This is another public sector Bank having its headquarters in my home state with which my father has had an association even before I was born. His pension account is with this Bank in Bengaluru. As a retired senior public servant respectful of all things that the Government does “legitimately”, he got himself enrolled with Aadhaar earlier this year, ignoring my misgivings about its usefulness to society. How well his biometrics were recorded is a story for another day. The bank official in the Malviya Nagar branch of this bank told me that I would be required to submit my Aadhaar details along with an introducer signing my application form without which my account would not be opened. I moved on to the next bank regretting my almost non-existent social life in the area which would not fetch me any friend who was a customer of these banks.
State Bank of India: Perhaps the largest networked of public sector banks in the country with branches in several countries abroad, SBI offered some hope as I had a student account with them during my days at the Jawaharlal Nehru University. The security guard with a double barreled gun was manning the “May I Help You” desk but without being intimidating at all. He told me that I would have to submit address proof along with a copy of the “Aadhaar card”. In order to cross check the requirements with a true blue bank official I asked him for further guidance. He made me look at the bustling branch premises and the long queues before various counters and advised me to read up a poster that was pasted on the back of the outer door of the office at the end of the ‘officials only’ area. The poster listed several ‘cards’ that could be submitted as proof identity for opening a new account with the Bank. “Aadhaar card” was one of them. However the next column required every new applicant to submit a copy of one of the 11 documents also, as proof of residence, namely, passport, electoral photo identity card, ration card or a registered house lease agreement amongst others. Who says the proactive disclosure of information clause of the Right to Information Act is not working?
Punjab National Bank: As I walked out of SBI, I remembered that I deposit my cheque for paying rent to my landlord with PNB, a public sector Bank. When I enquired with the helpful lady banker whether I could open my bank account only with Aadhaar details she replied, “aajkal to sabka Aadhaar card ban gaya hai. Keval Aadhaar se kaam nahin chalega.” (Everybody has an Aadhaar card today, so that alone is not enough.) I would have to submit a copy of my lease agreement with my landlord along with a copy of the “Aadhaar card”. However I could maintain a minimum balance of Rs. 1,000/- but I would have to find an introducer. At least here I knew whom to approach to be introduced. My landlord would be happy to do the honours but I would still need to go to Jangpura Extension to get his signature on the form (that would cost me Rs. 200 if I hired a three wheeler. I wish Malviya Nagar were connected to Jangpura by the Metro soon. At least the Metro delivers the convenience it promises.)
Punjab and Sind Bank: As I was wondering where to go next, I spotted the board of this public sector bank which I did not know was functioning in my area. The banker told me, I would have to submit a copy of my “Aadhaar card”, along with proof of residence and find an introducer. However I could maintain a minimum balance of Rs. 1,000/-.
HDFC Bank Ltd.: Having had enough of public sector banks I decided to visit the local branch of the HDFC Bank with which I have a salary account in another Branch in Delhi. The young bank official told me “Aadhaar sabse best hai sir, par Rs. 10,000/- minimum balance maintain karna padega” (Aadhaar is best of all documents, but you will still need to maintain a balance of Rs. 10,000/-). Apparently there is no need for an introducer to open a new account with private banks. That was some relief, but a balance of 10k? Thanks to my salary account I regularly scrape off the bottom using the zero balance facility.
ICICI Bank Ltd.: This private bank had a branch rubbing shoulders with the HDFC Bank’s branch in my area, so I walked in. The young lady banker was the kindest of all bankers I met. She offered me her visiting card (with her mobile number on it, Wowee!!) and took down my number. How could I refuse her my number saying I wanted to avoid pesky unsolicited calls when she had offered her own number? However, I would have to submit a cheque of Rs. 15,500/- drawn on any other bank account to open an account with them. So I must have a bank account to open another bank account? Hmm! Of course if I maintained a balance of Rs. 1,00,000/- my family members could open zero balance accounts using my connection with the Bank. Submitting a copy of the “Aadhaar card” was a must and the Bank would send someone to my house to verify whether I truly live there. So I would have to wait for him/her to visit me and hand over a copy of my photograph and of course a copy of the “Aadhaar card”. There was no need for an introducer. Hmm again! This is some slick service. But verification is still required. I walked out wondering what if I had changed my residential address and the Aadhaar details reflected my previous address?
Axis Bank: The bank official was prompt in responding to my query. I would have to submit a copy of my PAN card along with my Aadhaar details and maintain a minimum balance of Rs. 10,000/-. Oops!, out of my league. How many people have PAN cards in India? That can be the subject of a RTI application, a devilish “busybody” part of my brain told me.
Punjab and Maharashtra Cooperative Bank Ltd.: While walking back home I spotted a Scheduled Bank that has opened up in the same premises which used to be a departmental store that we frequented last year. The bank official told me submitting copies of the “Aadhaar card” and my PAN card and finding an introducer was a must for opening a bank account. I could operate my account with a minimum balance of Rs. 500/-. Now that’s my kind of bank, but I would still need two documents more than the Aadhaar card to open my account.
I walked back home wondering how someone like me holding 3 academic degrees and almost a fourth one, had to struggle with the system for a simple thing like opening a bank account in order to show that I am a law abiding citizen of India who does not transact business in the black economy, let alone lay a claim to subsidies. I wonder how much difficulty my fellow citizens in less fortunate circumstances would fare with banks. Surely, a ragpicker in any city would not find it easy to open an account with any of the public or private sector banks merely by using Aadhaar details as UIDAI claims. Then again, UIDAI officials claim Aadhaar is not a “card” but just a “number” linked to my demographic and biometric information. But on the ground the “Aadhaar card” seems to be proof of the number. Just as people watching the comic hero Superman fly ask, “Is it a bird, is it a plane?” we citizens feel compelled to ask about Aadhaar again and again “is it a number, it is a card, is it convenient or is it a flight of fancy?”
I wish I had a video camera to record by adventures today as proof to prevent the UIDAI officials from dismissing my experiences as bunkum. After all RBI’s circular that Aadhaar details were adequate for opening a bank account is the gospel truth for them. But the proof of the pudding is in the eating, and not so much in the recipe. I am happy to prove the truth of my findings if an official of UIADI were to accompany me to the very same banks another day. It would be good if it were a Saturday so that we do not waste precious hours of our working days to check if Aadhaar really works or not. I promise mum’s delicious dosas at breakfast to the UIDAI official who would take the trouble of coming over to Malviya Nagar to do the checking during the limited working hours of these banks. Or if aaloo paranthas better suit your palate, mum makes them very nicely as well. But do give me a week’s advance notice. J
p.s. I work with the Commonwealth Human Rights Initiative, an NGO and am a Co-Convenor of the National Campaign for People's Right to Information. The views expressed in this open letter are personal. This email is being bcced to people I share information about RTI and other related issues including friends in the mass media. As your email ids are in the public domain I have mentioned them openly in this email. I hope you will not take this personally. Under Article 350 of the Constitution I have a right to submit a grievance to any public officer in a language of my choice. - Venkat
I understand that KYC/Introducer/physical presence requirements are done away with only for opening of 'small' accounts as per RBI circular of July 2012.“Small account” means a savings account in a banking company where-
(i) the aggregate of all credits in a financial year does not exceed rupees one lakh,
(ii) the aggregate of all withdrawals and transfers in a month does not exceed rupees ten thousand, and;
(iii) the balance at any point of time does not exceed rupees fifty thousand”.
I also understand that the RBI has informed the GoI that the banks shall not be responsible if there are frauds in accounts opened solely based on Aadhaar number.
From your account, it is clear that the banks are rather confused about the whole issue.
It is good that you have exposed the confusion. A good effort in public interest!
The circular clearly says that "....letter issued by the UIDAI as described above as an officially valid document for opening bank accounts without the limitations applicable to ‘Small accounts"
It also asks banks to satisfy themselves regarding present address of the customer by obtaining proof
So what Mr Venkatesh was told by various bank officials seems to be accurate in terms of this circular.
The circular quoted by CA Patankar of October 17, 2011 says, "After further consultations with Government, it has now been decided to accept the letter issued by the UIDAI as described above as an officially valid document for opening bank accounts without the limitations applicable to ‘Small accounts’ as prescribed in paragraph 5 of our circular under reference." Additionally, also see latest RBI circular of October 25, 2013 athttp://rbi.org.in/Scripts/NotificationUser.aspx?Mode=0&Id=8526, which, inter alia, says, "In order to reduce the risk of identity fraud, document forgery and have paperless KYC verification, UIDAI has launched its e-KYC services. Accordingly, it has been decided to accept e-KYC service as a valid process for KYC verification under Prevention of Money Laundering (Maintenance of Records) Rules, 2005. Further, the information containing demographic details and photographs made available from UIDAI as a result of e-KYC process (“which is in an electronic form and accessible so as to be usable for a subsequent reference”) may be treated as an ‘Officially Valid Document’ under PML Rules. In this connection, it is advised that while using e-KYC service of UIDAI, the individual user has to authorise the UIDAI, by explicit consent, to release her or his identity/address through biometric authentication to the Payment System Operators (PSOs). The UIDAI then transfers the data of the individual comprising name, age, gender and photograph of the individual, electronically to the PSOs, which may be accepted as valid process for KYC verification."
Is the response from banks to Mr. Venkat in keeping with the latest circulars?