In what it could be a technical lapse or sheer good luck, several Jan Dhan account holders from Beed district in Maharashtra have been able to withdraw money using Aadhaar authentication from zero balance accounts, reports Marathi daily Loksatta
. Since these accounts had no money at all (zero balance), this withdrawal could not even be passed off as a part of the Rs5,000 overdraft facility promised on the Jan Dhan accounts, nor do they meet the overdraft criteria.
According to the report, two banks that saw such withdrawals --Maharashtra Gramin (MG) Bank and State Bank of India (SBI) -- have stopped all transactions being carried out from their customer service centres through Aadhaar authentication. It is not quite clear how the withdrawals started or who figured out that the banks were dispensing money even without a balance in the account. But it is reported that such withdrawals occurred on Tuesday and Wednesday from both banks. Very soon, hundreds of customers from Gevrai taluka started approaching the service centres to withdraw money, Bank officials became suspicious. Upon enquiry, they found that someone had spread a rumour that the government had deposited money in Jan Dhan accounts, the report from Loksatta says.
According to the report, both the banks are clueless about how much money has been withdrawn in the past two days and have started enquiry into this incident.
MG Bank has around two lakh customers. The Bank permits withdrawal of cash from accounts through Aadhaar from about 20 centres. The bank permits withdrawal of Rs10,000 at a time, and a total of Rs20,000 in a day through these customer service centres. An IT company called Vakrangi Software (which has a patchy track-record) operates these Centres, which are controlled from its Mumbai office, the report added.
After every transactions, customers receive an SMS alert on their registered mobile. However, since the customers, who withdrew money in these cases, had a zero balance, no alerts were generated.
Dr Anupam Saraph, Professor, Future Designer, former governance and IT advisor to Goa's former Chief Minister Manohar Parrikar, feels that this (incident) is adequate proof of how Aadhaar linkage is also destabilising our banking system besides jeopardising national security as has been highlighted to the Reserve Bank of India (RBI) and the government repeatedly since 2013. "The RBI has also failed its responsibility to de license Aadhaar Based Payment Systems following the orders from the Supreme Court. Clearly, the RBI cannot distance itself from its failure of responsibility that has resulted in this fraud. The government should recognise this as a national emergency and halt the Aadhaar monster and Aadhaar based direct benefit transfer (DBT). The RBI must stop all Aadhaar based know-your-customer (KYC) and banking immediately," he added.
Earlier this month, Indian Express had reported
how several officials were quietly depositing Re1 from their pockets to erase zero-balance accounts — and dress up the data of Jan Dhan accounts.
As many as 20 branch managers and officials told The Indian Express, on the condition that they not be identified, that there is "pressure" on them to show that zero-balance accounts are falling in number. "There was a perception that so many zero-balance accounts means no one is using them, so there was pressure on us to change that," one official was quoted by the newspaper.
The newspaper also filed an application under the Right to Information (RTI) Act. As per the information it received, 18 banks from the public sector and their 16 regional rural subsidiaries held 1.05 crore Jan Dhan accounts with deposits of Re1.
Earlier in May, SS Mundra, Deputy Governor of RBI, while raising concerns that Jan Dhan accounts can be used by money mules, have warned that such accounts are vulnerable to frauds and asked banks to be on vigil. He said third parties could be used to launder the proceeds of fraud schemes (such as phishing and identity theft) by criminals who gain illegal access to deposit accounts by recruiting them as 'money mules'.
The RBI Deputy Governor also highlighted a case where an idle account was used for receiving and transferring large funds without the knowledge of the accounts holder. "It was an account of a daily labourer in Punjab and the account was opened as a basic one where there is limitation on number of transactions. This amount of transaction was of Rs1 crore," he said.
The case became known when the income tax authority served the notice to the account holder. "This episode highlights the failure of the banks system and processes for monitoring of newly opened accounts," Mundra had said.
As per Basic Statistical Return (BSR) statistics for 2014-15 released by the RBI, the Pradhan Mantri Jan-Dhan Yojana (PMJDY) accounts swelled to 14.4 crore in 2015 constituting 17.4% increase in the group. Admitting that several accounts could be with zero-balance, the banks were supposed to open overdraft accounts after six months of operations. Data reveals that banks opened such accounts only in respect of 0.65% of the total number of accounts as at the end of December 2015.
While the bank officials were busy reducing zero balance accounts from their records, rural folks hit back by actually withdrawing money from such accounts. Simply amazing.