If your cash deposit or withdrawals in a year cross a certain threshold, you may not get away by quoting your permanent account number (PAN), you will be required to authenticate your Aadhaar. In an attempt to puncture the large flow of currency in the economy and to keep tabs on the menace of depositors quoting fake PANs, the government is set to mandate Aadhaar authentication. This will be done either through electronic-KYC (know your customer), using biometric tools or via one-time password (OTP) if in case you cross the specified value.
Following the amendments proposed in the Finance Bill, this move will be extended to several other high-value transactions including the purchase of foreign exchange above a prescribed limit, where currently, consumers are required to quote their PAN. Similarly, in case of property transactions if you cross the specified value, disclosing your Aadhaar or PAN will not work. Your transaction may need to be Aadhaar-authenticated, at the time of property registration, as per the sources.
“We want to work out the limit in a way that only people making transactions above a certain value are tracked without causing hardship in case of smaller transactions,” a government source told the national publication. While the annual limits are yet to be worked out, the mandatory Aadhaar authentication using biometric tools or OTP could be placed at Rs 20-25 lakh worth of cash deposits or withdrawals. The mandatory authentication could eventually be extended to several other high-value transactions, including property deals.
According to the sources cited by the newspaper, this move was important as several depositors were quoting fake PANs, due to which transactions were not getting tracked. By mandating authentication, the government is trying to ensure that bogus identification numbers are not used. “It’s not foolproof but will help reduce fraud,” said the source.
This means that if your cash deposits or withdrawals cross the certain threshold, you will have to authenticate your Aadhaar. Apart from this, to reduce the difficulty to businesses that deal in cash, such as a Kirana store or a dairy, a system may be worked out where every cash transaction with a bank does not need authentication…..Read more>>