Banks scramble to set up Aadhaar centres before September 30

To enable seamless linking of Aadhaar with bank accounts, the Unique Identification Authority of India (UIDAI) has asked all banks to set up Aadhaar enrolment and update centres by September 30.

In a circular to the banks, UIDAI said banks would be required to have one centre per 10 branches they operate. It further said a penalty of Rs 20,000 every month would be imposed on banks who fail to open Aadhaar centres before the deadline, the Economic Times reported.

However, banks which are in the process of sourcing biometric devices, and need more time to set up centres as and identifying authorised agencies.

Issuing the new circular, the government is trying to step up Aadhaar service centres as every account holder is required to submit the Aadhaar number to banks by December 31.

The central government made it mandatory to verify Aadhaar with know-your-customer (KYC). The banks and financial institutions were directed to make sure their customers are KYC compliant. According to the new rules, one must submit Aadhaar and PAN details to the bank to be KYC-compliant. The deadline for verifying Aadhaar with the KYC is December 31, 2017.

In case the user fails to submit the details in KYC forms before the deadline, the bank account will be barred from all banking activities.

A senior banking sector official told ET that the banks are making preparations to comply with the UIDAI directive.

Bengaluru-headquartered state-owned lender Canara Bank said it is opening 1,040 Aadhaar centres across India and Bangalore itself will have 18 centres. The bank will open its first centre at the Jayanagar shopping complex branch on September 25.

"We will provide the infrastructure and the centres will be run by authorised agencies," the business daily quoted Canara Bank General Manager M M Chiniwar as saying. "We are ready with the infrastructure. The Aadhaar agencies have to set up theirs," he added.