Aadhaar no longer mandatory for banking, phones, Centre clears changes to law

New Delhi, Dec 17: The Cabinet on Monday approved amending the two existing laws to provide legal backing for seeding of biometric ID Aadhaar with mobile numbers and bank accounts.

The Cabinet headed by Prime Minister Narendra Modi approved amendments to the Telegraph Act and the Prevention of Money Laundering Act (PMLA) after the Supreme Court in September imposed restrictions on the use of Aadhaar by private companies.

The two Acts will be amended to provide for voluntary sharing of the 12-digit identification number for obtaining new mobile phone connections and for the opening of bank accounts.

The government's move came after the Supreme Court struck down Section 57 of the Aadhaar Act, which allows private entities to demand the 12-digit unique identity number before providing services.To overcome this lacuna, the Telegraph Act is being amended to provide legal backing for the issuance of mobile SIMs through Aadhaar.

Similarly, the amendment to the PMLA will give individuals option to link their bank accounts to Aadhaar in the KYC option.