Telcos demand Aadhaar-based e-KYC for verification charges to be reduced to 70-80 paise

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Updated: Oct 08, 2020 8:26 AM

The letter further said no authentication charges were levied earlier on TSPs for online authentication done via the Aadhaar-based e-KYC process, which was the primary reason behind Aadhaar becoming the primary mode of on-boarding subscribers.

In order to allow use of Aadhaar by private entities like banks and telecom operators on voluntary basis, the government in July 2019 had passed the Aadhaar Amendment Bill.“Trai should look at a combination of fixed fee and usage charge for floor price."

Mobile operators have demanded that charges for Aadhaar-based e-KYC for verification of mobile subscribers be reduced to 70-80 paise per activation from the current Rs 41, which they feel is exorbitantly high.

The telcos have highlighted that as per the current rules, government entities as well as banks are exempt from authentication charges, but telecom service providers (TSPs) are being burdened with high charges despite the industry being the largest user of the Aadhaar database.

The department of telecommunications (DoT) restored Aadhaar-based electronic verification of telecom subscribers on September 29. The use of Aadhaar was stopped in October 2018 following the Supreme Court order, which had restricted the use of the unique number by private entities in the absence of a legal provision. In order to allow use of Aadhaar by private entities like banks and telecom operators on voluntary basis, the government in July 2019 had passed the Aadhaar Amendment Bill.

But the telecom industry is of the view that the high charges of authentication would be a dampener as other modes of verifying customers are much cheaper.

The Aadhaar (pricing of Aadhaar authentication services) regulations 2019, prescribes an authentication charge of `20 for each electronic know your customer (e-KYC) transaction and 50 paise each for yes/no authentic transaction from requesting entities. As per the instructions of DoT for issuing a connection, TSPs are required to carry out online authentication of the subscriber as well as the point of sale (PoS) agent. “Evidently, this takes the cost of each SIM activation to Rs 41, which is exorbitantly high compared with the cost of each digital KYC activation, which is available at literally no cost to TSPs,” the Cellular Operators Association of India (COAI) said in a letter to Pankaj Kumar, CEO, UIDAI. A similar letter was also sent to the DoT.

The letter further said no authentication charges were levied earlier on TSPs for online authentication done via the Aadhaar-based e-KYC process, which was the primary reason behind Aadhaar becoming the primary mode of on-boarding subscribers.

“Due to the nil transaction charges, the government and TSPs were able to ensure on-boarding of subscribers in a robust and secured way,” the letter said. However, later, the Aadhaar regulations 2019 put in the charges for authentication of telecom subscribers while barring government entities and banks. The industry body said the TSPs have met both the DoT as well as UIDAI officials several times and an assurance was also given that withdrawal of charges would be considered.

“We request you to kindly review and amend the Aadhaar (pricing of Aadhaar authentication services) regulations 2019 for the telecom sector,” COAI DG SP Kochhar said in the letter.

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