Moneylife: Pune: Wednesday, December 26, 2018.
State Bank of India (SBI), the country's
largest lender, has decided to discontinue Aadhaar based payment system (AEPS)
and had informed its decision to the UIDAI, reveals a reply received under
Right to Information (RTI) Act.
The reply received by Srinivas Kodali, an
activist, has details of the opinion of SBI's law department about using AEPS
by account holders. It says, "...in terms of the Supreme Court judgement,
withdrawal of money by a beneficiary through Aadhaar authentication or AEPS is
to be made or can be made permissible only for the amount of actual monetary
subsidy or benefit received by the beneficiary (in his bank account) and not
for using the said account (which may also have credits being credited into the
same from other sources along with the government subsidy) for making
withdrawal of other amounts. However, there being a practical difficulty, where
beneficiary of direct benefit transfer (DBT) scheme, having other credits being
credited in to his account, may also end up using AEPS system for withdrawing
an amount much higher than the amount what was credited in his account as
government subsidy. It may lead to stepping over the mandate of the judgement,
which restricts the use of AEPS transactions only to the extent of DBT
amount."
"Now, our competent authority has
approved discontinuance of AEPS system from 1 December 2018, to ensure that the
bank is not on the wrong side of the Supreme Court judgement in terms of
compliance," the letter says.
Interestingly, while SBI denied sharing
this letter, Mr Kodali was able to obtained it from Unique Identification
Authority of India (UIDAI) under the RTI. SK Thakur, central public information
officer (CPIO) of SBI, told Mr Kodali, that "The information sought by you
is of commercial confidence of the bank and hence exempted from disclosure
under section 8(1)(d) of the RTI Act."
This incident also how public authorities
try to hide information under various excuses under the RTI Act.
Earlier in August this year, the
state-run lender had disabled pay to Aadhaar functionality from its Bharat
interface for money application (BHIM) SBI Pay app citing regulatory
guidelines.
In fact, National Payments Corp of India
(NPCI), which developed and promotes unified payments interface (UPI) and
(BHIM), itself had asked banks to discontinue Aadhaar-based payments through
the UPI and Immediate Payment System (IMPS) channels. Pay to Aadhaar is an
additional functionality in UPI and IMPS where the payer can transfer funds to
the beneficiary using an Aadhaar number.
"Aadhaar number is a sensitive
information and the revised framework about its usage in the payment landscape
is still evolving. With this background, we proposed removal of ‘Pay to
Aadhaar’ functionality in both UPI and IMPS before the steering committee
(meeting held on 5 July 2018). The proposal of removing the Aadhaar number
functionality was approved by the steering committee,” NPCI had said in a
circular issued on 17 July 2018.
Later in September 2018, the Supreme
Court declared Section 57 of the Aadhaar Act as unconstitutional. This means
bank account-holders, e-wallet or mobile wallet users and mobile subscribers
are no longer required to use their Aadhaar number.
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