The Reserve Bank of India (RBI) has stated that the linking of bank accounts with Aadhaar, a 12-digit unique-identity number issued by the Unique Identification Authority of India (UIDAI) to all the residents of India based on their biometric and demographic data, has been made mandatory under the provisions of the Prevention of Money Laundering Act. However, the Supreme Court (SC) believes that the initiative should be put on hold until there is a clear directive. The All India Bank Employees Association (AIBEA) is also protesting the rules because the organization believes the information is voluntary rather than mandatory in order to protect privacy.
When the issue of privacy arises, individual rights and whether they are being violated are questioned. Kalyani Menon Sen, a self described feminist scholar and activist who has been working on issues related to women’s rights for over 25 years, is also challenging the validity of RBI’s decision with a petition filed through fellow advocate Vipin Nair. The petition states that RBI’s decision “violates the solemn promise given by the authorities that parting of biometrics by individuals was on a voluntary basis.”
PMLA was created in order to prevent money laundering and to provide for confiscation of property derived from money laundering. When a person is not giving allegedly mandatory information in regards to biometric identification, the offender is punished for poor cooperation.
Establishing mandatory linkages of bank accounts with Aadhaar numbers is an arbitrary addition to Know Your Customer (KYC) requirements as it is dependent on Aadhaar and the details associated with the accounts and, according to the petitioner, “constitutes an unreasonable risk for financial autonomy and privacy of account holders, banks and financial sovereignty of the nation.”
The petition will be heard by SC this week.
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