High value cash transactions may soon require Aadhaar approval.
Recently, the Government of India has discovered a number of depositors providing fake Permanent Account Numbers (PAN). The depositors often utilise fake PAN cards and make malicious transactions. In order to prevent such misuse, the Government of India is set to mandate Aadhar card authentication via electronic KYC (by using biometric tools or through an OTP, One Time Password System).
This step is a part of actions undertaken by the government to track and detect the flow of illegal money in the economy. So if you make certain transactions (cash withdrawals or deposits) above a certain threshold, be prepared to shell out your Aadhar card details. This rule will also apply to property registration and foreign exchanges where an individual was simply required to furnish PAN details. As per the new rules and regulations, all high value transactions will be authenticated via Aadhar card.
Reportedly, the government made the following statement on this matter: “We want to work out the limit in a way that only people making transactions above a certain value are tracked without causing hardship in case of smaller transactions”
In addition to this notification, the government has proposed to make Aadhar card authentication mandatory using biometric tools or OTP for annual deposit and withdrawals amounting to Rs. 20-25 lakhs. Though the limits are still under consideration, the final slab is still under development.
Through this effort, the government aims to reduce the number of unregistered transactions authenticated via bogus identification. For individuals undertaking large value transactions, Aadhar card authentication will become mandatory. For small business owners (kirana, grocery and dairies) who deal in large cash transactions on a daily basis, the business is not required to authenticate each transaction. The next step of the government is the effective implementation of this action. Also, the government has already undertaken the final decision of making Aadhaar and PAN card interchangeable from 1st September 2019.