Published: April 25, 2020 10:24:38 pm
The finance ministry has allowed 29 insurance firms and 9 securities entities to collect Aadhaar for the aim of know your buyer (KYC), a transfer aimed toward checking cash laundering and routing investments into shell firms.
Finance Secretary Ajay Bhushan Pandey mentioned that the 2 notifications issued on this regard by the Ministry of Finance “to allow these entities to use Aadhaar authentication services under Aadhaar Act with necessary standard security and privacy measures would help these entities to perform in real time, do e-KYC and would also reduce their cost of transaction.”
“This would also be beneficial to the customers or the investors, especially the small and retail investors, as they need not submit physical papers or documents for KYC”, Pandey, who can be the Revenue Secretary, mentioned.
The transfer is aimed toward checking laundering of funds into insurance firms and shell firms.
An official mentioned use of Aadhaar authentication service by these entities is voluntary and if an investor offers Permanent Account Number (PAN), she or he doesn’t have to go for Aadhaar authentication.
Through two notifications, the finance ministry has allowed 29 insurance firms and 9 inventory/securities entities to undertake Aadhaar authentication providers of Unique Identification Authority of India (UIDAI) underneath part 11A of the Prevention of Money Laundering Act (PMLA), 2002.
The BSE, National Securities Depository Ltd (NSDL), Central Depositary Services (India) Ltd, CDSL Ventures Ltd, NSDL Database Management Ltd, NSE Data and Analytics Ltd, CAMS Investors Services Ltd, Computer Age Management Services Pvt Ltd and Link Intime India Pvt Ltd are the 9 inventory/securities associated entities.
The 29 insurance firms embody Bajaj Allianz Life Insurance, Bharti AXA Life Insurance, ICICI Prudential Life Insurance, HDFC Life Insurance, HDFC Ergo General Insurance and SBI General Insurance.
The ministry has allowed these insurance and securities entities to make use of Aadhaar authentication providers underneath the PMLA topic to the satisfaction of their regulatory authorities, particularly – the Insurance Regulatory Authority of India (IRDAI) and the Securities and Exchange Board of India (SEBI), respectively that they’re complying with the usual of privateness and safety as per Aadhaar Act.
“This would ease their KYC process and reduce cost and time besides preventing money laundering activities, if any”, the ministry mentioned.
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