Legislation proposes voluntary Aadhaar biometric authentication for bank and telecom customers

India’s government has tabled legislation in the Lok Sabha expected since the Supreme Court decision to block the requirement of Aadhaar verification by private entities, which would amend three separate Aadhaar-related laws, and allow customers to volunteer their biometrics for identity verification for banking, telecom, and other services, the Deccan Herald reports.

The bill would also allow minors registered with Aadhaar to opt out of the system at 18 years of age, addressing another concern discussed during the Supreme Court hearings, and put more severe penalties in place for violating Aadhaar regulations. In the case of voluntary use, service providers would still be barred from storing the biometric data or Aadhaar number of the customer, as well as from denying service to those who do not volunteer for Aadhaar verification.

Telecom service providers would also be able to verify customers through offline Aadhaar verification, a passport or other official documents approved by the government. The correct procedure for offline verification is described, and the Unique Identification Authority of India (UIDAI) will gain new power to apply and enforce regulations if the bill passes. The dispute resolution process for telecoms is also updated in the proposed legislation.

Banks and telecoms in India have struggled with how to meet their obligations to identify customers since the Supreme Court ruling, with offline Aadhaar and various new methods proposed to fill the gap.

Entities violating the Aadhaar Act could face civil penalties of up to Rs10 million (US$140,000), with additional daily penalties up to Rs1 million (US$14,000) for continued failure to comply. Unauthorized use of identity information would become punishable by up to 3 years in prison, along with fines, and unauthorized access to the central database or data tampering could be punished by up to 10 years in prison, up from the current maximum of 3 years.

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