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NBFCs and payment service providers get Aadhaar e-KYC license, which will help in preventing fraud

The Reserve Bank of India said that NBFCs and payment system providers can apply to the central bank for Aadhaar e-KYC verification license.

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Non-Banking Finance Companies (NBFCs) and Payment Service Providers have also got an Aadhaar e-KYC Authentication License. Reserve Bank of India has approved Aadhaar e-KYC for NBFCs and Payment Service Providers. This will encourage digitization. Fintech companies said, the Reserve Bank’s decision to allow NBFCs and payment service providers to apply for obtaining an Aadhaar e-KYC authentication license will promote digitization and help prevent fraud.

The Reserve Bank of India said that NBFCs and payment system providers can apply to the central bank for the Aadhaar e-KYC verification license.

In accordance with the provisions of the Prevention of Money Laundering Act (PMLA), 2002, entities other than banking companies, by notification of the Central Government, by using the e-KYC facility provided by the Unique Identification Authority of India (UIDAI) on the customer’s Aadhaar number may be allowed to certify.

It Will help in preventing fraud

Fintech companies have welcomed the Reserve Bank’s decision to allow non-banking finance companies (NBFCs) and payment service providers to apply for an Aadhaar e-KYC verification license. These companies say that this move will encourage digitization and help prevent fraud.

Digitization will get a boost

Commenting on this decision, Ankit Bhatnagar, Head of Product, Mswipe, said that this move of RBI will help in instilling more trust among the customers as only licensed entities will be allowed to do e-KYC.

Infrasoft Technologies Ltd. Manoj Chopra, Head of Innovation and Product Development, said that this move of the central bank will help NBFCs and payment service companies to connect with customers.

On the other hand, Gurjodhpal Singh, Chief Executive Officer (CEO) of Tide (India) on RBI’s decision said that this is a commendable step for the financial technology company system. He said that this move will boost digitization and improve the experience for the customers who are facing a lot of issues.

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