The Unique Identification Authority of India (UIDAI), overseeing the Aadhaar database, is enhancing the offline identity verification service for citizens, aiming to make it more secure and user-friendly while encouraging greater adoption by financial services providers.

UIDAI aims to enhance and manage the procedure enabling citizens to finish the Aadhaar-linked customer identification, or know-your-customer, process with service providers without revealing their Aadhaar number or personal information, they stated.

The existing approaches to electronic, biometric, and offline KYC necessitate that the customer provide their Aadhaar number or be present in-person at the service provider for validation.

In June, the KYC procedures at several fintech companies and non-banking lenders were impacted when the UIDAI and the Ministry of Electronics and Information Technology (Meity) shut down the websites of various startups for purported unauthorized access to the Aadhaar database. Food delivery and ecommerce startups relying on Aadhaar to verify gig workers and blue-collar staff encountered interruptions in their onboarding procedures.

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Numerous discussions have taken place, and UIDAI has stated unequivocally that users can utilize offline Aadhaar-based KYC without needing to disclose their Aadhaar number or personal information. The government-supported agency has also emphasized that the verification must be conducted solely with the customer's consent.

These exchanges have occurred between UIDAI and authorized representatives: Aadhaar Authentication Agencies and KYC User Agencies.

Startups encountering issues with their onboarding services were considering reaching out to Meity for clear authorization to use the Aadhaar database.

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To enhance the popularity of this verification process, UIDAI plans to advocate for QR codes and PDF files in addition to the original XML data that customers must download from the UIDAI website for offline KYC, the second banker mentioned. This should simplify document management for customers and enable them to complete their KYC process more easily.