The use of Aadhaar card services has significantly eased the electronic Know Your Customer (e-KYC) process for organisations, while reducing the cost from around Rs 1,000 ($12) to less than Rs 6 (6 cents), the Economic Survey 2024 showed.
KYC is one of the most vital process for financial institutions and businesses to get information like identity, addresses, phone numbers, etc. of customers. This is done to get a better understanding of the their identity and prevent fraudulent activities.
Typically, varied forms of identification documents can be used to electronically verify the customer’s credentials. However, amongst all, Aadhar card has remained the most convenient and commonly used.
“Aadhaar has been instrumental in transforming India's authentication ecosystem. It has facilitated the KYC process, reducing the cost of conducting e-KYC from USD 12 to 6 cents, extending banking to millions of Indians and improving financial inclusion,” the survey said.
The survey also highlighted advances made in 'Digital Financial Inclusion (DFI)' by leveraging India Stack, which has enabled millions to accept payments, settle invoices, and transfer funds anywhere in the country with just a few screen taps.
Among the three critical components of India stack--identity, payment and data governance—Aadhar has been an important in the identity layer, the Survey said.
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