UIDAI Suspends Airtel, Airtel Payments Bank’s eKYC Licence
UIDAI noted a “blatant disregard” of the Aadhar Act in Airtel’s actions.
In its strongest action yet, the Unique Identification Authority of India has temporarily barred Bharti Airtel and Airtel Payments Bank from conducting Aadhaar-based verification of mobile customers using eKYC process as well as verification of its payments bank clients.
The action follows allegations of Bharti Airtel using the verification process to open payments bank accounts of its subscribers without their informed consent. UIDAI also took strong objection to allegations that such payments bank accounts are being linked to receive LPG subsidy.
In an interim order, UIDAI “suspended e-KYC licence key of Bharti Airtel Ltd and Airtel Payment Bank Ltd with immediate effect,” sources with direct knowledge of the development said.
This essentially means Airtel would not be able to carry out electronic-verification or link SIM cards of its customers with their 12-digit biometric Aadhaar though the paperless eKYC (electronic Know Your Customer) process of the UIDAI. Also, Airtel Payments Bank will not be able to open a new account with Aadhaar e-KYC. However, accounts can be opened through alternate methods, if available.
When contacted, an Airtel spokesperson confirmed that the company had recieved the interim suspension order. “We are engaging with the authority and are hopeful of an early resolution” the spokesperson said. “We are also undertaking to complete the said actions on priority and have commenced thorough checks of our process flows,” the spokesperson added.
Being compliant to all guidelines is paramount to us. In the interim, any inconvenience to our customers is regretted.Bharti Airtel Spokesperson
More than 23 lakh customers have reportedly received as many as Rs 47 crore in their Airtel bank accounts, which they did not know had been opened. Sources said it was of UIDAI that at the time of mobile verification, Airtel retailers were also opening Airtel Payments Bank accounts, without informing the user. Government LPG subsidy was also getting transferred to these accounts, without their consent.
UIDAI observed that as per agreement with the authority, Airtel and Airtel Bank are duty bound and under obligation to ensure security and privacy of residents' identity information.
Security and privacy of Aadhaar data is a highly sensitive matter and the Supreme Court is looking into its various aspects.
UIDAI has also ordered PricewaterhouseCoopers to conduct an audit of Bharti Airtel and Airtel Payments Bank to ascertain if their systems and processes are in compliance with the Aadhaar Act. It may consider revocation of suspension or decide further necessary action upon receipt of the report.
The alleged actions of Airtel and Airtel Payments Bank were found to be in violation of different sections of the Aadhaar Act, 2016, which mandates obtaining explicit consent of the individual. Violations are liable to be punished with Rs 1 lakh per day fine and termination of authentication user agreements.
Both Bharti Airtel and Airtel Payments Bank were appointed as Authentication User Agencies (AUA) and had entered into an agreement with UIDAI in February 2015 and September 2016 respectively for availing authentication services provided by the authority.
Airtel and Airtel Bank stated that they have amended their process and the opening of a bank account is completely de-linked from the process of re-verification of mobile connection, sources said in response to the first notice of September 18.
These replies were found to be unsatisfactory by UIDAI, which issued another notice on November 24. The company responded by saying no bank account was opened without the consent of the customers and additional safeguards have been introduced. These replies too were found to be unsatisfactory as UIDAI continued to receive numerous complaints of unauthorised opening of Airtel Payments Bank accounts.
Sources said the interim order listed out some of the complaints and went on to state that Airtel and Airtel Bank had made "false statements" to "deceive and mislead" UIDAI.
When UIDAI reviewed the Airtel mobile app, it found that when the app is opened, along with the welcome message a pre-ticked consent box is momentarily flashed on the screen which states "Upgrade or create my Airtel Payment Bank wallet using existing Airtel mobile KYC." This was found to reflect blatant disregard of Aadhaar Act and Regulations.