In response to increasing instances of fraud within the Aadhaar Enabled Payment System (AePS), the RBI has issued draft guidelines aimed at strengthening the onboarding and ongoing monitoring processes for AePS touchpoint operators.
“In recent times, there have been instances of frauds perpetuated through AePS due to identity theft or compromise of customer credentials. To protect bank customers from such frauds, and to maintain trust and confidence in the safety and security of the system, a need is felt to enhance the robustness of AePS. Accordingly, it has been decided to issue directions for streamlining the process for onboarding of AePS touchpoint operators and on-going due diligence,” the RBI stated in a circular.
Key provisions:
- The acquiring bank must carry out due diligence of all AePS touchpoint operators onboarded by it, in accordance with the Customer Due Diligence procedure for individuals, stipulated in Part-I, Chapter-VI of the Master Direction – Know Your Customer Direction, 2016 (as updated from time to time), issued by the Reserve Bank.
- The acquiring bank must carry out updation of KYC in cases where an AePS touchpoint operator has not performed any financial transaction for a continuous period of six months, before enabling him / her to transact further.
- NPCI and acquiring banks shall ensure that any AePS touchpoint operator is onboarded only by one acquiring bank.
- The acquiring bank shall monitor the activities of AePS touchpoint operators on an ongoing basis and set operational parameters.
