Cabinet approves Aadhaar ordinance: Now private bodies can use it to authenticate users

India Prime Minister Narendra Modi-chaired union cabinet has approved the ordinance to allow voluntary use of the Aadhaar as identity proof for private bodies such as banks and telecom firms.

The amendments proposed are the same changes as those contained in the Bill passed by the Lok Sabha in January. It has claimed to made amendments to the Aadhaar Act 2016, Prevention of Money Laundering Act 2005 & Indian Telegraph Act 1885, as per the govt release.

The amendment provides for voluntary use of Aadhaar number in physical or electronic form by authentication or offline verification with the consent of Aadhaar number holder.

It allows the use of Aadhaar number for authentication on a voluntary basis as an acceptable KYC document under the Telegraph Act, 1885 and the Prevention of Money-laundering Act, 2002.

It permits private firms to perform authentication when they are compliant with the standards of privacy and security specified by the authority. It also gives an option to children who are Aadhaar number holders to cancel their Aadhaar number after reaching the age of eighteen years.

Earlier in September last year, the Supreme Court had struck down Section 57 of Aadhaar act that permits private firms to seek Aadhaar data.

“Section 57, to the extent, which permits the use of Aadhaar by the State or any body corporate or person, in pursuant to any contract to this the effect is unconstitutional and void,” the Apex Court had said in its 1448-page long judgement.

It proposed to amend the Aadhaar Act, Indian Telegraph Act and the Prevention of Money Laundering Act in line with SC directives.

After its approval in the Lower House, the Aadhaar and other Laws (Amendment) Bill could not pass through the Upper House.