Niti Aayog chief executive Amitabh Kant today said the Reserve Bank should go for a ten-fold increase in the deposit and advances caps on accounts opened through OTP-based eKYC.
Niti Aayog chief executive Amitabh Kant today said the Reserve Bank should go for a ten-fold increase in the deposit and advances caps on accounts opened through OTP-based eKYC. Such a liberalisation in the caps will help deepen the cashless or digital journey, he said. “To my mind the proposal to push OTP-based ekyc is high (priority). For deposit accounts, the present limit is Rs 1 lakh. I think we should increase it to about Rs 10 lakh. For loan accounts, the existing limit is Rs 60,000, my view is that it should be raised to Rs 6 lakh,” Kant said addressing a Bankbazaar event here.
In order to bring customers on board faster as part of the financial inclusion agenda, the RBI had allowed for the one time password (OTP) based electronic know your customer (e-KYC) of accounts, but set certain caps on the transactions which go through such accounts.
Identifying this as an impediment in the growth of the cashless agenda, Kant said more reforms are needed on this with priority. “There is a need to allow the OTP-based eKYC for credit cards as well,” he said.
He asked the RBI to also allow for digital signatures on loan documents, saying the central bank is yet to come up with an express notification on it despite the Government of India taking a decision to allow it.
Apart from that there is also the “challenge” of allowing digitally signed mandates for repayment of loans which needs to be looked into, Kant pointed out. “We have several areas of regulatory action. We need to push for reforms in a bigger way,” Kant said.
He said the banks also need to great up to the changes and should look at disbursing loans within five minutes of an application being made through the use of the digital technologies and richer databases.
He said paperless loan applications help reduce the incidence of NPAs, which the entire banking system is fighting with at present. Kant said there are 29 crore bank accounts opened under the Prine Minuster’s Jan Dhan Yoajana till August.