To protect the interests of the banking industry, Indian Banks’ Association (IBA) on Monday moved the Supreme Court seeking to be made a party in a batch of petitions challenging the validity of the Aadhaar card.
Urging that the outcome of the petitions shall impact the entire banking industry, IBA wants the top court to vacate its August 11 order restricting the voluntary use of unique identification number (UID) scheme to PDS and LPG schemes only.
A five-judge constitution bench will hear all pleas seeking a modification to the apex court’s interim order. The bench comprising Chief Justice HL Dattu and Justices MY Eqbal, C Nagappan, Arun Mishra and Amitava Roy will hear various pleas on Wednesday.
The association, representing around 210 banks and financial institutions, told the apex court that if the interim order was not changed or vacated, it would have wide ramifications on financial inclusion.
Asserting that the banking industry is required to play a pivotal role with respect to financial inclusion, IBA, in its application, said the Aadhaar card is “at epicentre of the implementation of social-benefit schemes and provisions of financial services to the weaker sections and low-income individuals of the society who have been deprived of benefits due to lack of documents required for establishing their identity and place of residence”.
It submitted that RBI has issued certain guidelines regarding seeding of Aadhaar card numbers to bank accounts for implementation of the direct benefit transfer scheme. “This helps in seamless transmission of benefits of social-benefit schemes to account holders directly,” it said.
Citing a www.pmjdy.gov.in data, it said as on August 12, 7.27 crore accounts were seeded with Aadhaar out of total 17.57 crore accounts opened under the scheme. In addition, data received from National Payment Corporation of India show that approximately 20 crore accounts have been linked with Aadhaar.
“Seeding a person’s bank account with his/her Aadhaar number ensures that the account number belongs to the person to whom the number is issued. This also ensures that remittance of money reaches the person for whom it is meant and not any other person. This does not, in anyway, mean that the UIDAI or any government/other agency would get information about any other transaction effected in such an Aadhaar-seeded account,” it said.