Aadhaar now a must for transactions above Rs 50k

Aadhaar now a must for transactions above Rs 50k

Also, no new bank accounts without UID number

Aadhaar now a must for transactions above Rs 50k
Without Aadhaar, you can’t open a bank account or conduct a transaction for Rs 50,000 or more. The government notified the new rules on Friday, and also said existing bank accounts would be invalid if they were not seeded with Aadhaar before December 31.

Those without the unique biometric identity can furnish proof of enrolment for Aadhaar when opening a bank account, and submit their Aadhaar numbers within six months. The rules came into force through an amendment to the Prevention of Money Laundering (Maintenance of Records) Rules of 2005.

Under the earlier law, financial transactions of Rs 50,000 and above called only for a permanent account number (PAN). New accounts won’t be operational unless PAN and Aadhaar numbers are submitted to the bank, the notification said.

The notification comes close on the heels of the Supreme Court upholding the government’s move to link Aadhaar with PAN.

Small accounts

The notification allows for some concessions for ‘small accounts’, while it also empowers the authorities to keep a close watch on them so that they are not misused for money laundering. Holders of such accounts will have to provide officially valid documents within 24 months. “When there is a suspicion of money laundering or financing of terrorism or other high-risk scenarios, the identity of claim shall be established through the production of official valid documents,” the notification says. Small accounts can be opened only with bank branches with core banking. They will be monitored manually to ensure foreign remittances are not made into them.

The RBI defines a ‘small account’ as a savings account with an aggregate of credits not exceeding Rs 1 lakh in a year, withdrawals and transfers in a month not exceeding Rs 10,000, and the balance at any point not exceeding Rs 50,000.