Page 16 - FIGI: e-KYC use cases in digital financial services

from individuals for the purpose of enrolling them ical as well as electronic payment and settlement
into the Aadhaar system. systems.
The biometric and demographic data is main- NPCI has collaborated with Unique Identification
tained in a Central Identities Data Repository (CIDR), Authority of India (UIDAI) to create a centralised
identity claims and authentication services are pro- Aadhaar mapper. It maintains an association between
vided through open Application Programming Inter- customer's Aadhaar number, mobile number, and
faces (APIs) with yes/no answers. Several applica- Bank accounts. This central repository can be used
tions like eSign, digital locker, mobile banking apps to route payment instructions based on Aadhaar
etc. use Aadhaar biometric based authentication number or mobile number. The Aadhaar mapper, at
services. present acts as an enabler for payment owing to the
UADAI provides the following functional process- Aadhaar number mapping to the Account number as
es to enroll and verify identity of users of Aadhaar the financial address. NPCI has already build capabil-
ities such as the e-KYC and Aadhaar Payment Bridge
• Enrolment process: creating and storing an (APB) system around this enablement. Unified Pay-
enrolment data record for an individual who is ment Interface (UPI), Immediate Payment System
the subject of a biometric capture process in (IMPS), and National Unified USSD Platform (NUUP)
accordance with the enrolment policy. The sub- can take advantage of Central Mapper for fetching
ject usually presents his/her biometric charac- and routing their payments. Hence having such a
teristics to a sensor along with his/her identity common repository can create a great process value
reference. The captured biometric sample is pro- add, for overall payment ecosystem and consequent-
cessed to extract the features which are enrolled ly to the end customer.
as a reference in the enrolment database with
identity reference. 2�4 Authentication and e-KYC for DFS
• Verification process: testing a claim that an indi- UIDAI offers two types of services/facilities for
vidual who is the subject of a biometric capture private sector and DFS providers:
process is the source of a specified biometric
reference. The subject presents his/her identity a) Authentication services to authenticate identity
reference for a claim of identity and biometric claim in the form of Yes/No using biometric or
characteristic(s) to the capturing device, which Mobile OTP; and
acquires biometric sample(s) to be used for b) E-KYC (Electronic Know your Customer) authen-
comparison with the biometric reference linked tication explicitly allowing UIDAI to share their
to the identity reference for identification. The demographic data with the requesting party only
verification process has a possibility of impact- after Aadhaar holder's consent.
ing a subject's information privacy, since this pro-
cess requires both biometric reference and iden- To explain how the authentication and e-KYC services
tity reference. The identification process requires work a brief overview of the Aadhaar authentication
exhaustive search of enrolment database. So, this and KYC ecosystem is provided first, which, describes
also has a possibility of impacting on subject's the role of each stakeholder.
physical privacy. Verification is generally con-
sidered to be less privacy intrusive than identi- 2.4.1 Aadhaar authentication ecosystem
fication. In Aadhaar system verification is done The Aadhaar authentication ecosystem has following
via online authentication having only a "yes/no" agencies:
answer.
a) AUA (Authentication User Agency)

2�3 National Payments Corporation of India AUA connects to the Aadhaar Database and uses
While Aadhaar system provide basic identity authen- Aadhaar authentication to validate a user and enable
tication, National Payments Corporation of India its services. Examples of AUAs are banks, various
(NPCI), an umbrella organization set up with the state and central government ministries provid-
guidance and support of the Reserve Bank of India ing services such as the Public Distribution System
(RBI) and Indian Banks Association (IBA) provides (PDS), the National Rural Employment Guarantee
infrastructure to the entire Banking system for phys- Scheme (NREGS), and private agencies like mobile
phone operators. An AUA is required to enter a

14 e-KYC use cases in digital financial services