Aadhaar project is not only an illegal project but is also a very controversial one. It is a classic example of civil liberties protection in cyberspace. In fact, the illegality of Aadhaar project has already been questioned in many High Courts and the Supreme Court of India. However, the vote bank politics of Indian government kept it faithful to Aadhaar project even though it is unconstitutional and illegal in nature.
Finally, the Supreme Court of India declared that Aadhaar cannot be made compulsory for availing public services. Still the unconstitutional and illegal biometrics collection in India is still going on. Indian government has finally decided to introduce a bill that would provide a legal framework for Aadhaar project in the present winter session of the Parliament i.e. December 2013.
Surprisingly, the Reserve Bank of India (RBI) has suggested use of Aadhaar number/card/data by all new ATMs and point of sale (POS) machines. Clearly this direction of RBI is illegal and in clear violation of the direction of Supreme Court of India. That is the reason why Banks in India are simply ignoring the same and they are well within their rights to do so as RBI cannot force them to invest in illegal and unlawful projects.
Banks of India have to consider not only the legal aspects of Aadhaar but they have to keep in mind commercial aspects as well. The present infrastructure is well equipped to meet the requirements of customers and Aadhaar based ATM and POS machines would only complicate the scenario.
Recently the security and risk mitigation measures for card present transactions in India was brought into force by RBI. Much crucial security related issues have been ignored by the banks of India. Instead of enforcing the same the RBI is helping Indian government is expanding its e-surveillance projects. The UN Draft Resolution on the Right to Privacy in the digital age has been passed but India seems to be going in the opposite direction.
The best way to deal with illegal and unconstitutional projects like Aadhaar and to reject patently illegal policies of Indian government is to reject them out rightly and Indian banks are rightly doing the same. The bank customers must also support banks in their fight against illegal policies of RBI and Indian government.