“The fact that Aadhaar numbers are being generated based on biometrics of a person (fingerprints, iris scan), it will be very difficult to fake identities,” said the first official cited above.
With UIDAI, it will also become possible to weed out the fakes from the system, this person added.
A person needs a Permanent Account Number to open a demat account, but the system currently in use to process IPO applications has no way of identifying fake accounts.
A second official said, “It will be not be wrong to say that the waters are being tested for all securities transactions to be linked to Aadhaar, which could create an unprecedented system of tracking such investments.”
D.R. Mehta, former Sebi chairman, said a unique identity applicable for all transactions could help prevent fraud. “An identity that is well established and that cannot be duplicated will help in making transactions more secure,” he added.
The finance ministry has already notified that the Aadhaar number is adequate to meet the know your customer (KYC) norms of banks and is all that is needed to open a bank account.
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