18th June, 2018
Business

Read Why Airtel Is Suspended From Using Aadhaar For Authentication

The country’s top telecom operator has temporarily been suspended from using Aadhaar for authentication purpose for its connections and open new payment bank accounts by UIDAI.

The suspension follows after the operator opened payment bank accounts of its users without their explicit consent in September 2017. The operator misused Aadhaar details and did an electronic know-your customer (e-KYC) verification process to open the accounts.  The opening of payment banks account also led to the transfer of LPG subsidy payments into the accounts.

After the complaints to UIDAI, Bharti Airtel may now have even have to pay a fine for the alleged violation of rules on using Aadhaar for its e-KYC process.

How much fine

The penalty will have to be paid for the number of days the rules were violated. The amount  could run upwards of Rs 2 crore.

As per the Aadhaar Act, the penalty for violation is a few lakhs each day.

UIDAI has sent a notice to the company and a final amount will be decided after PwC finishes its audit. The PwC has been engaged by UIDAI for audit.

Airtel has confirmed that it has received an interim order from the UIDAI regarding temporary suspension of Aadhaar-linked, e-KYC services. The company has said to work till their satisfaction on certain processes relating to Airtel Payment Bank's onboarding of customers.  It also said that “Being compliant to all guidelines is paramount to us. In the interim, any inconvenience to our customers in regretted.”

Subsidies went missing

The Airtel customers didn’t realise that their accounts were being opened. And, hence had no clue that subsidies were redirected too.

Many of the customers were not aware of the change in bank account status and thought that government had stopped their subsidies.

Subsidies of approximately 4.7 million LPG customers is said to have been transferred to such accounts. The amount stands to be amounting to Rs 167 crore.

Airtel changes process

The express check within the app has been changed to opt-in mode.

Changes to open Payment Bank possible

The move may disrupt the new payment bank accounts opening. The Reliance Jio is preparing for the launch of its own payment bank soon and the process may affect the opening procedure.