Money & Banking

Ensure all accounts are seeded with Aadhaar numbers by March next: FM to banks

Our Bureau Mumbai | Updated on November 10, 2020 Published on November 10, 2020

Union Finance Minister Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman was addressing at the Indian Banks’ Association’s 73rd annual general meeting.

Union Finance Minister Nirmala Sitharaman on Tuesday asked Banks to seed all their accounts with ‘Aadhaar numbers’ ideally by December-end 2020 but not later than March 31, 2021.

“Financial inclusion story is not over. You still have inclusion to carry forward.

“You still have so many out there who still do not have a bank account. And when I say a bank account, it is ‘Aadhaar seeded’ account,” Sitharaman told bankers at the Indian Banks’ Association’s 73rd annual general meeting.

The Minister emphasised that she does not want to hear from any bank that though it can do DBT (direct benefit transfer), it does not know how many accounts are not Aadhaar seeded.

“I don’t think beyond December this year I can even be patient to hear that there are still accounts in banks which are not yet Aadhaar seeded.

“...So, I would think, ideally by December 2020, if not by March 31, 2021 every account should have a PAN (Permanent Account Number details) where needed and applicable and Aadhaar (seeded) in every one of your accounts,” Sitharaman said.

The Minister underscored that over and above the demands of their current work schedules, banks have to ensure that every one of the accounts they have has PAN card details where required and Aadhaar in every account seeded.

Digital Payments and RuPay

Sitharaman observed that Banks should discourage non-digital payments as much as possible. Further, they should adopt a Unified Payments Interface (UPI) driven payments.

She emphasised that the homegrown RuPay card will have to be the only card that Banks should promote.

“Whoever needs the card, RuPay will be the only card you would promote.

“I wouldn’t think it is necessary today in India when RuPay is becoming global, for Indians to be given any other card first than the RuPay itself,” the Minister said.

Amalgamation

Referring to the amalgamation of 10 public sector banks (PSBs) into four, which happened with effect from April 1, 2020, Sitharaman said: “Yes, there is a lot of amalgamation happening, and I can always wish to have each one of the amalgamated banks to be as big as SBI (State Bank of India).”

India can have eight more SBI’s in this country, post amalgamation, she added.

“I am sure you (Bank chiefs) are putting your energies into seeing how best you can be not just in size but also in the kind of diversified activities you can undertake.

“And, therefore, India is thirsting for large banks. We want large banks as much as we want smaller banks. We want NBFCs because they can reach out to far-flung areas,” Sitharaman said.

The Minister opined that amalgamation (among PSBs) should not just remain as an exercise to bring two or three banks together.

“It should now become an organic mechanism to grow and to grow to such scale that the new demands from the industry, business and the economy can all be met up in a changing world,” she added.

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Published on November 10, 2020
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