The Unique Identification Authority of India on Friday made it mandatory for all the telecom operators and e-sign service providers to start accepting virtual ID from July 1 instead of the Aadhaar number. However, other service providers including banks will have time until August 31 to deploy the new feature. Virtual ID is a critical security measure for protecting people's privacy and their Aadhaar information. With the introduction of Virtual ID, Aadhaar number holders will have an option of not sharing their unique identity number and instead they can generate a virtual ID and share it with authentication user agencies to perform Aadhaar-based authentication.
This year in January, the UIDAI had announced that it would introduce Virtual ID feature which an Aadhaar-card holder can generate from its website and produce for various authentication purposes instead of sharing the actual 12-digit biometric ID.
In a circular dated June 29, the UIDAI said virtual ID (VID) system is operational with authentication user agencies which have migrated to VID and UID token using the software (Auth API 2.5 and e-KYC API 2.5) that supports new VID capability. The authority has also classified all authentication agencies registered with it into two heads -- global or local. Banks have been categorised as global authentication user agency (AUAs) and telecom companies amongst local AUAs for the purpose of authentication and KYC entitlement.
As per the norms laid down by the UIDAI, global AUAs will be allowed access to complete KYC with Aadhaar number, and the entities classified as local AUAs will have limited access to KYC details of customers. The UIDAI in its circular has stated that those telecom companies and e-sign providers that have not implemented the VID system shall be charged Rs 0.20 for every transaction performed after July 1. However, in case they are able to fully migrate to the new platform by July 31, the entire authentication transaction charges imposed for the above said period of July 1-31, 2018, shall be waived.
The UIDAI has further cautioned that in case the service provider fails to migrate fully to the new system by August 31, the authority "shall be free to take actions under the Aadhaar Act including imposition of financial disincentives and termination of license key". The UIDAI had previously said that all agencies that undertake authentication will start accepting VIDs from their users from June 1, 2018 but had then decided to give one extra month (till July 1) for its deployment, after the user agencies said they needed more time to switch to the new system.
The authority has instructed all authentication agencies to make necessary changes in front-end application to accept Aadhaar number as well as Virtual ID, and in backend application to accept UID token and limited KYC data immediately. Once the new feature is fully implemented, it will allow Aadhaar holders to create and produce a random 16-digit number without actually disclosing their Aadhaar number for any authentication. A person can generate as many VIDs as he or she wants, and the older ID gets automatically cancelled once a fresh one is generated.