Indian government is allowing banks to verify individual transactions that exceed a certain annual limit by using facial recognition and iris scan in some cases to reduce fraud and tax evasion, according to three sources quoted by Reuters.
Indian government is allowing banks to verify individual transactions that exceed a certain annual limit by using facial recognition and iris scan in some cases to reduce fraud and tax evasion, according to three sources quoted by Reuters.
Some large banks, both private and public, have begun using the option, one of the Reuters’ sources who is a banker said. The source declined to name the banks. An advisory that allows such verifications has not been made public yet and it has not even been reported.
Verification by facial recognition and iris scan is not mandatory and is intended for cases where another government identification card, like the Permanent Account Number (PAN) card, is not shared with banks.
Some privacy experts are concerned about the prospect of banks using facial recognition, according to the Reuters report.
“This raises substantial privacy concerns especially when India lacks a dedicated law on privacy, cybersecurity and facial recognition,” said Pavan Duggal, an advocate and cyber law expert, quoted by Reuters.
The government is aiming to get parliamentary approval for a new privacy law by early 2023, it has said, Reuters reported.
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The new verification method can be used to verify identities of individuals making deposits and withdrawals exceeding 20 Lakh Rupees in a financial year, in case the proof of identity shared by the customer is Aadhaar card, two government officials who declined to be named by Reuters said. The officials did not want to be named because the information is not public.
The Aadhaar card carrys a unique number that is tied to an individual’s fingerprints, face and eye scan.
Unique Identification Authority of India (UIDAI) had suggested, in a letter, that verification should be done through facial recognition and iris scanning, especially where fingerprint authentication of an individual fails. In December, India’s finance ministry asked banks to take “necessary action” on the letter, according to Reuters.
UIDAI, which is the body that issues Aadhaar cards, had made no mention of a consent framework for facial verification and iris scanning in the letter. It did not say whether banks may take action if a customer refuses or not either.
Earlier a government order last year mandated the quoting of an Aadhaar card or PAN card for making deposits or withdrawals exceeding 20 Lakh Rupees in a financial year.
(With agency inputs)
