SBI to discontinue Aadhaar-based payments system; UIDAI calls it obstruction in 'delivery of benefits'

Taking note of the State Bank of India's intention to discontinue its Aadhaar-enabled payments system, the Unique Identification Authority of India (UIDAI) has termed it an "obstruction in the delivery of benefits". The apex body on Aadhaar reiterated that voluntary use of Aadhaar can't be denied by any institution.

The UIDAI said it has received a letter from the State Bank of India, informing the discontinuation of Aadhaar-based payments system citing the September 26 ruling of the Supreme Court on Aadhaar. The UIDAI said in its judgement in the Justice KS Puttaswamy Vs Union of India case, the apex court "upheld the constitutionality of the Aadhaar programme", specifically Section 7 of the Aadhaar Act, 2016.

"...Aadhaar is used as a means of authentication for availing services, benefits and subsidies. Welfare schemes funded from the consolidated fund of India such as PDS (public distribution system), scholarship, mid-day meals, LPG subsidies, free education, etc, ensure that the Right of Life and Dignity of citizens are being enforced, which includes justice (social, political and economic)," the UIDAI said.

It said multiple identities had given rise to rampant corruption at various levels in the implementation of welfare schemes, and that the Aadhaar scheme has been successful in curbing these malpractices. "There have been cases of duplicate and bogus ration cards, BPL cards, LPG connections etc. Some persons with multiple identities getting those benefits manifold," it added.

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The UIDAI said the SC judgement on Aadhaar does not bar voluntary use of such payment or receipt mechanism or bank account by the bank account holder for other purposes. "Instead, it is obligatory on banks to continue to provide such facility to people," said the UIDAI.

The Aadhaar body said any action to discontinue such payment mechanism, including Aadhaar-based payment system, BHIM or Aadhaar Pay or even bank accounts by banks on the basis of the SC judgement on Aadhaar is "obstruction in the delivery of benefits and may cause denial in deserving cases".

The SC in its judgement on Aadhaar had said it wasn't mandatory to link Aadhaar to bank accounts or mobile numbers and that telecom service providers couldn't seek Aadhaar linking. Other key takeaways from the verdict were -- individuals and corporations can't collect Aadhaar data; government can't give Aadhaar to illegal immigrants; Aadhaar need not to be made compulsory for school admissions; no person can be denied govt benefits only due to absence of Aadhaar; Aadhaar card is mandatory for PAN linking, Income Tax return, among others.

Edited by Manoj Sharma