wordpress blog stats
Connect with us

Hi, what are you looking for?

Banks Will Oppose Biometric Authentication In Card Payment Units


Indian banks are all set to oppose RBI’s circular advising banks to include biometric sensor in all new credit card swiping machines and ATMs to enable Aadhaar based payments, reports Economic Times. This comes at a time when the Indian government is trying to introduce The National Identification Authority of India Bill, 2010 bill in Parliament, despite significant criticism.

Indian Bank’s Association met recently to discuss the circular, which they feel is rushed and being implemented without understanding the implication it has on banks. These banks feel that they shouldn’t have to spend crores to upgrade the infrastructure needed to enable biometric authentication. Apart from procuring ATMs that support this feature, they will also need to upgrade to broadband. The other issue they have is the high failure rate with biometric authentication, which means it could take longer for each transaction to be completed.

Procuring these new ATMs won’t be easy for the banks as they say there are not enough manufacturers who can supply ATMs or POS units that can accept traditional cards with magnetic strips, EMV pin and chip, as well as equipped with biometric readers for accepting Aadhaar-based transactions.

It needs to be remembered that banks had voiced their discomfort over the use of biometric authentication for payments to the working group that was set up by RBI. The findings of this group are not known, as RBI has not put up the report on its website.

That said, banks have started implementing parts of the RBI circular. For example, POS units now require a user to put in the PIN for the transaction to go through. It eliminates the chance a card being misused by a thief, but we’ve seen consumers criticise its implementation. Read this, this, this, thisthis and this.

Advertisement. Scroll to continue reading.

Aadhaar as authentication

– Reliance Communications had said in May that it would be using Aadhaar’s online authentication to activate new connections. Vodafone had also carried out pilot project offering Aadhaar based verification in October 2012.

– MakeMyTrip founder Deep Kalra had told Medianama earlier that they are looking forward to using biometric information as a second form of authentication.

– The Unique Identification Authority of India (UIDAI) had launched three Aadhaar enabled services back in May this year: an authentication services using Iris, an authentication service using one time pin (OTP) and an electronic know your customer (eKYC) service.

– NASSCOM Product Council had collaborated with Unique Identification Authority of India (UIDAI) to launch a new initiative called ‘Aadhaar Diffusion Project’, which aims to step up the development of apps and services that use Aadhaar’s identity infrastructure for eKYC.

Aadhaar for payments

Advertisement. Scroll to continue reading.

At the NASSCOM event, UIDAI chairman Nandan Nilekani had said that UIDAI partnered (.doc file) with National Payments Corporation of India (NPCI) to launch Aadhaar based remittance service, which enables money transfer from one Aadhaar number to another number or to bank accounts and vice versa. At TiEcon Delhi in October, he had said this facility will be rolled out in couple of months.

Legal scope of Aadhaar

The Indian government had tried to make Aadhaar mandatory, by linking essential services with it, and allowing government departments to make it mandatory for particular schemes: for example, in Delhi, it is mandatory for marriage licenses. It has also been linked to schemes such as LPG subidies. However, The Supreme Court of India passed an interim order that Aadhaar cannot be made mandatory for government services. The Centre, UIDAI and three oil PSUs — IOCL, BPCL and HPCL — had later on moved the Supreme Court seeking modification of its earlier order. The Supreme Court has now sought responses of all states in two weeks on the constitutional validity of the nationwide scheme being implemented by the Unique Identification Authority of India (UIDAI).

Written By

I'm passionate about technology and gaming. You can follow me <a>@chupchap</a>

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



The Delhi High Court should quash the government's order to block Tanul Thakur's website in light of the Shreya Singhal verdict by the Supreme...


Releasing the policy is akin to putting the proverbial 'cart before the horse'.


The industry's growth is being weighed down by taxation and legal uncertainty.


Due to the scale of regulatory and technical challenges, transparency reporting under the IT Rules has gotten off to a rocky start.


Here are possible reasons why Indians are not generating significant IAP revenues despite our download share crossing 30%.

You May Also Like


Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...


135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...


Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...


By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Your email address:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ