- Cooperative banks are set to offer Aadhaar-enabled payment services thanks to a new framework introduced by the Unique Identification Authority of India (UIDAI).
- This initiative is designed to broaden access to digital financial services in rural and semi-urban areas.
- During a workshop in New Delhi on Friday, Cooperation Ministry Secretary Ashish Kumar Bhutani highlighted how this move will empower cooperative banks, making them more capable and self-sufficient as financial institutions.
- “This will greatly enhance financial inclusion in rural and semi-urban India, aligning with the government’s vision of inclusive growth through cooperation,” Bhutani stated in an official release.
- The new framework tackles long-standing issues that have kept cooperative banks from participating in the Aadhaar authentication system due to compliance and cost barriers.
Cooperative banks are set to offer Aadhaar-enabled payment services thanks to a new framework introduced by the Unique Identification Authority of India (UIDAI). This initiative is designed to broaden access to digital financial services in rural and semi-urban areas.
During a workshop in New Delhi on Friday, Cooperation Ministry Secretary Ashish Kumar Bhutani highlighted how this move will empower cooperative banks, making them more capable and self-sufficient as financial institutions.
“This will greatly enhance financial inclusion in rural and semi-urban India, aligning with the government’s vision of inclusive growth through cooperation,” Bhutani stated in an official release.
The new framework tackles long-standing issues that have kept cooperative banks from participating in the Aadhaar authentication system due to compliance and cost barriers. UIDAI crafted this simplified approach in collaboration with the Ministry of Cooperation, NABARD, NPCI, and the cooperative banks themselves.
Under the updated structure, only the 34 state cooperative banks (STCBs) will register with UIDAI as Authentication User Agencies (AUAs) and eKYC User Agencies (KUAs). The 351 district central cooperative banks (DCCBs) will then be able to utilize the Aadhaar authentication infrastructure of their respective state banks, which means they won’t need to set up separate IT systems.
“The revised framework is a strong and forward-thinking mechanism that will significantly help cooperative banks nationwide in adopting Aadhaar-enabled authentication and eKYC services,” said UIDAI CEO Bhuvnesh Kumar.
NABARD Chairman Shaji KV pledged full support to cooperative banks in rolling out this framework. The workshop attracted representatives from all STCBs and DCCBs, with over 500 participants joining online.
This streamlined approach is anticipated to make the process more cost-effective and efficient, providing a significant boost to last-mile banking and efforts toward digital inclusion.