Banking With Your Aadhaar Number Mark

Biometric ATMs ride in on Aadhaar

By Jonathan Ananda

CHENNAI: A few years ago, biometric ATMs were something that excited imaginations. Money with just a fingerprint? An iris scan? No hassles of PINs and passwords? The idea was an instant hit. But the years following saw the fervour die down a bit. Banks weren’t as quick in rolling out biometrically enabled teller machines.

That has changed in the last few months, with bank after bank introducing pilots, in the case of DCB Bank an official launch, of biometrically enabled cash machines in select areas. The vital change in banks’ willingness to finally rollout something that they have been infrastructurally capable of for years has been spurred by one single factor — Aadhaar. The biometric footprint of lakhs of Indians provided by UIDAI has finally given banks the wherewithal to enable biometrics in their last mile cash delivery platforms.

“Quite frankly, it was never a priority for us (public sector banks) because of the other challenges we were struggling with,” pointed out a senior bank official in a nationalised bank. “Collecting biometric information from customers would have involved a lot of human resources, those we couldn’t spare. Aadhaar has solved that particular problem,” he added.

It is not just distracted PSBs that were waiting for a readily available database. Private banks like Axis Bank, which are rolling out pilots in several areas, were doing the same thing.

“Earlier, we had to create our own biometric footprint. Now that everyone has one available over a simple API call, it makes sense for us to bring in biometrics,” said Amit Sethi, Chief Information Officer, Axis Bank.

In fact, Sethi says that all new ATMs that Axis will install in the next year might well come biometrically enabled.

“We are already running a pilot and we will launch it officially very soon,” he admitted.

DCB Bank’s Managing Director & CEO, Murali M. Natrajan agrees that Aadhaar has been a game changer, The bank has launched what it claims is the India’s first Aadhaar based ATM. Which accepts customer’s Aadhaar number and fingerprint (biometric) impression in addition to the usual debit card.

“The Aadhaar linked ATM transaction has enabled customers use their Aadhaar number and fingerprint details instead of the Debit or ATM Card PIN. The user either can key-in the 12-digit Aadhaar number or use the Debit or ATM Card (ATM) to start a transaction. At the stage of confirming the identity the customer simply puts any finger on the scanner rather than the PIN,” Natrajan pointed out.

But banks like Axis and HDFC have already rolled out a version of biometrics in their micro ATM initiatives. HDFC announced the measure early last year. Sethi says Axis has a large number of micro ATMs in rural geographies that do everything, including disburse instant loans through biometric verification.

But biometrics, while ‘cool’ was a bit of an overkill when it was just cash that was being disbursed through ATMs. “But ATMs do a lot more now. They do KYC work, they disburse loans, there are so many use cases. It makes a lot of sense integrating biometrics with them now,” pointed out Sethi.

Another factor pushing banks is that fact that technological differentiation is steadily becoming a vital aspect of how customers move to and from banks.

“Twenty new banks are coming in now. And a lot of these are going to be using technology to differentiate — in user experience, cost of operations etc,” said Navroze Dastur, Managing Director, NCR Corporation India.

NCR is one of the largest ATM manufacturers in the world and has a 48 per cent market share o the ATM market in India.

The rollout of biometrics is not just confined to ATMs. ICICI Bank has introduced an over the phone voice verification feature for customers and Standard Chartered meanwhile announced the rollout of a host of biometric capabilities for Asia, Africa and the Middle East. The ‘Touch in’ feature is already live in India.

The age of biometrics is here. And ATMs are riding the crest of the wave. What has made this possible, however, is Aadhaar.