UIDAI has launched a new framework to extend Aadhaar to cooperative banks. With this system, more than 380 cooperative banks will now provide Aadhaar based authentication and eKYC services.
With this, customers in rural and small towns will get every facility from opening an account to getting subsidy in an easy and secure way.
This new system will especially connect people living in rural and semi-urban areas, who often had difficulty in getting banking services. Now opening an account, getting subsidies and doing digital transactions will become easier and safer than before.
Which banks will come under the purview?
This new framework of UIDAI will cover the cooperative banks of the entire country. 34 State Cooperative Banks (SCBs) and 352 District Central Cooperative Banks (DCCBs) will come under this purview. That means a total of more than 380 banks will work under this system.
How will the system work?
Under the new rules, only State Cooperative Banks (SCBs) will be registered with UIDAI as Authentication User Agency (AUA) and eKYC User Agency (KUA). District Cooperative Banks (DCCBs) will not need to create a separate IT system. They will be able to use the IT infrastructure of their State Cooperative Bank. This will save costs and the system will become simpler and faster.
What benefits will the customers get?
Customers will get many direct benefits from this framework.
- Fast account opening: Processed in minutes with Aadhaar eKYC and face authentication.
- Increased security: Biometric verification prevents fraud.
- Simplicity: Accounts can be opened even in rural areas without much paperwork.
- Direct Subsidy: Subsidy and government scheme money will come directly into the account through Aadhaar Payment Bridge.
- Digital Transactions: Cash withdrawal, balance check and transactions made easy with AePS.
Why is this step important?
Millions of people in India are still not fully connected to the banking system. Especially in small towns and villages, people hesitate to open an account or do digital transactions. In such a situation, by providing Aadhaar services through cooperative banks, more and more people will get connected to banking. Along with this, financial inclusion will be promoted and the money of government schemes will reach the right place without middlemen. Not only this, cooperative banks will become stronger.
A big gift in the International Year
This framework has been launched keeping in mind the International Year of Cooperatives. The government wants to strengthen cooperative banks on this occasion so that they can reach every village and give the benefits of digital banking to the people.
Conclusion
This new framework of UIDAI will prove to be a game changer for both cooperative banks and their customers. This will not only reduce the cost of banks, but will also provide ease and security to the customers. With the Aadhaar based system, subsidies and government aid will reach the bank account directly and the dream of digital banking will come true in every village.
Frequently Asked Questions (FAQs)
Q1. How many cooperative banks will join this system?Total more than 380 banks, including 34 SCBs and 352 DCCBs.
Q2. What benefits will customers get from Aadhaar services?Opening an account, getting subsidy and making digital transactions will become easier.
Q3. What will district cooperative banks have to do?
They do not need to create a separate IT system, they will use SCB’s system.
Q4. Will this prevent fraud?
Yes, security will be strengthened with biometric and face authentication.
Q5. When and why was this framework launched?
Launched to enhance financial inclusion on the occasion of International Year of Cooperatives.
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