E-sign, a service that allowed Aadhaar holders to digitally sign a document, has been stopped with immediate effect on Friday by the National Securities Depository (NSDL).
The certifying authority, in a letter on Thursday, announced the decision to discontinue eSign services.
“As advised by UIDAI, we are stopping e-sign services with immediate effect,” said a Firstpost report quoting the letter.
The services have been stopped as NSDL faced issues integrating different data sets for purposes of verification, mismatches and submission of fakes. It had also approached UIDAI in regard to the matter. UIDAI is yet to make public its official stand on the matter.
E-sign service started with a vision to assist digital transactions and verifications. It authenticated the individual customer through an Aadhaar-based electronic know your customer (e-KYC) mechanism.
NSDL is not a single certifying authority. EMudhra, SafeScrypt and C-DAC are also e-sign service providers.
After the discontinuation of e-sign services, the companies using NSDL services would not be able to digitally authenticate and collect signatures of customers at the time of onboarding. Now brokerages and fintech firms will have to physically onboard customers.
Startups such as Digio, Veri5 and Khosla, whose business models revolve around Aadhaar e-sign services, will be affected by the move.
In September, a Supreme Court verdict prohibited entities from using Aadhaar and had forced firms to adopt paper-based process to onboard customers.