Linking Aadhaar with bank accounts becomes boon for the banking industry

New Delhi, Aug 22: India Banking Conclave (IBC) organized by Centre for Economic Policy Research (CEPR) and NITI Aayog plans to discuss not only individual and institutional banking but safe and better banking with the linking of Aadhar number to the bank accounts.

Besides other issues about the banking, linking of Aadhaar with bank accounts was applauded and criticized at the same time however the government was appreciative of its role not only disciplining the banking industry but for its help in the financial gain to the government. IBC plans a threadbare analysis on the issue.

Gopal Krishna Aggrawal, an economist and one of the organizers, told OneIndia, "Aadhaar is actually creating a single identity. Let me tell you an instance of the past when a company had been found with having more than 2000 bank accounts. This is what was actually happening earlier. Not only individuals but corporate were opening multiple accounts with multiple banks having a different identity and separate addresses. Accounts were not linked to each other. So money laundering was being done from one bank account to other bank account by creating walls between the two bank accounts. This was ultimately helping create black money without any trail in the entire system. But once the present government started linking bank accounts with Aadhaar, opening multiple bank accounts without linking them became impossible."

The other important thing that the Aadhaar has been able to do was that banking has been considered by the government as very good and efficient vehicles for transferring social security schemes of any government to the common people. There were large scale leakage and those leakages are also being addressed by Aadhaar. Direct Benefit Transfer (DBT) is one facility through which leakages into the government scheme has been stopped.

The government sources said that Aadhaar has been linked to the Jan Dhan Account ensuring financial participation and inclusion of poor people. This has helped the government to save huge subsidy money without reducing subsidy to poor. The government has been able to save Rs 29,000 crore in the Ujjwala Scheme just because of the DBT.

The government through Aadhaar seeding has been able to have audit trail of any account if an individual or the company has the multiple banks accounts, the government can check those multiple bank accounts. By linking bank accounts with Aadhaar, the cases of money laundering have completely stopped. Similarly for the corporate sector, the government took serious action by deregistering shell companies as more than three lakh such shell companies have been deregistered so the deregistering shell companies and seeding corporate bank accounts with Aadhaar have helped preventing money laundering and stopping generation of black money as transferring money from one account to another and parking black money from one account to another was stopped.