Fintech Companies’ Authentication Services Revoked by UIDAI

he Unique Identification Authority of India (UIDAI) has revoked access to some fintech players in the market. The information has been released by the Times of India saying that the UIDAI revoked access to several agencies providing e-KYC verification and authentication services.

Because of this situation some KUA (e-KYC user agencies) and AUA (authorized user agencies) companies will no longer be able to provide e-KYC verification.

This is going to affect companies that work in the e-commerce industry and offering peer-to-peer lending. Companies will now have to physically verify the credentials of the customers, increasing costs for the firms.

Jitendra Gupta, MD of PayU India, explained about it:

“This is detrimental to fintech companies which rely on e-KYC for user verification and on-boarding. A physical KYC costs about Rs 100 per person while the same is roughly Rs 15 when it is done via e-KYC.”

According to a chief digital officer at a private bank in India said that UIDAI’s actions taken against KUAs are related to some reporters saying that they were storing customers’ data on their devices. Moreover, these KUAs attempted to create parallel databases with help from the dark web.

The Aadhaar has been involved in this issue, showing that private information from users and individuals is never safe. Indeed, it the report explains that the information has been used to create private databases.

About it, the French Security researcher, Elliot Alderson wrote:

Repeat after me: #Aadhaar is foolproof, #Aadhaar is unhackable, … pic.twitter.com/xUFXTsIDad

— Elliot Alderson (@fs0c131y) September 4, 2018