SB Order 01/2025: Introduction of Paperless KYC and Aadhaar-Based Authentication for POSB Accounts
Download SB Order 01/2025 in PDF
The Department of Posts, under the Ministry of Communications, has introduced a revolutionary initiative aimed at simplifying and streamlining the customer onboarding and transaction processes in Post Office Savings Bank (POSB) accounts. Through SB Order No. 01/2025, dated January 1, 2025, the government has announced the implementation of paperless Know Your Customer (e-KYC) processes and POSB account transactions via Aadhaar Biometric Authentication.
Phase-Wise Implementation of e-KYC Process
In the first phase, the Department has decided to enable the creation of Customer Information Files (CIF) and opening of Single and Individual type POSB accounts using Aadhaar-based e-KYC authentication in departmental post offices. The Finacle Core Banking System (CBS) has been updated to accommodate these changes.
Key Finacle Menu Updates
ECCRC: Enables CIF creation and modification via Aadhaar authentication.
CASBAO: Facilitates Aadhaar-based POSB account opening.
CASBAM: Allows modifications in e-KYC-based POSB accounts.
CTM and CXFER: Support Aadhaar-authenticated transactions alongside traditional paper-based voucher systems.
Masked Aadhaar Display: Ensures Aadhaar numbers are securely displayed in a masked format.
Aadhaar Data Fetch and Validation
During the e-KYC process, essential details such as the customer's name, C/o Name (Father/Husband), date of birth, gender, and address are fetched from the UIDAI's Central Identities Data Repository (CIDR). If certain fields are incomplete or incorrect, the customer will need to update their Aadhaar details before proceeding.
Transaction Protocols
Deposits and withdrawals (up to ₹5,000) can be performed via Aadhaar biometric authentication without requiring a paper voucher.
Transactions involving third-party deposits must follow the traditional pay-in-slip process.
Aadhaar-authenticated transactions are directly posted in Finacle without requiring verification by a checker.
Customer Consent and Documentation
Until full system enhancements are in place, customers' consent for e-KYC, along with specimen signatures, will be collected in physical forms (SB-eKYC-1 & SB-eKYC-AOF). The Aadhaar number on documents will be masked to protect privacy.
Pilot Program and Nationwide Rollout
The e-KYC functionality was successfully piloted in 12 Head Post Offices and 2 Sub Post Offices starting November 26, 2024. It will be rolled out nationwide from January 6, 2025.
Ensuring Data Security and Compliance
All records, including physical and digital documents containing Aadhaar information, must display only masked Aadhaar numbers. Postmasters are responsible for ensuring compliance with these guidelines.
Conclusion
The introduction of paperless KYC and Aadhaar biometric authentication for POSB accounts marks a significant step towards digital transformation in postal banking services. It aims to enhance customer convenience, reduce paperwork, and ensure faster and more secure transactions across all post offices in India.
This initiative not only aligns with the Digital India mission but also paves the way for greater financial inclusion and improved service delivery in the postal sector.
