NPCI Introduces e-KYC Setu for All Regulated Entities

NPCI Introduces e-KYC Setu for All Regulated Entities. Recently, the National Payments Corporation of India (NPCI) has developed and implemented the e-KYC Setu System, a game-changing Aadhaar-based KYC platform for regulated entities in the financial sector. This system is specially designed to offer a one-stop digital solution to simplify the customer onboarding journey while ensuring compliance with Indian regulations. From banks and insurance companies to NBFCs and pension funds, this platform supports all regulated entities (REs) under RBI, SEBI, IRDAI, and PFRDA.
What is the e-KYC Setu System?
The e-KYC Setu System is a secure digital interface that enables seamless access to online Aadhaar-based e-KYC services. Developed under the provisions of the Aadhaar Act, this system allows financial sector entities to verify the identity of customers through UIDAI’s authentication services. Unlike traditional KYC methods that involve manual document collection, physical verification, and data entry, e-KYC Setu ensures a paperless, contactless, and privacy-protected verification process. What sets this platform apart is its ability to offer real-time identity verification while minimizing the operational burden of managing sensitive Aadhaar data. NPCI acts as a secure intermediary, sending Aadhaar authentication requests to UIDAI on behalf of the regulated entity and sharing masked identity data in return.
Who Can Avail e-KYC Setu Services?
The e-KYC Setu platform is available to Regulated Entities (REs) operating under various financial sector regulators in India. These include:

RBI-regulated banks and NBFCs

SEBI-registered capital market intermediaries

IRDAI-regulated insurance companies

PFRDA-regulated pension funds

These entities can adopt e-KYC Setu without the need for a specific Gazette Notification under Section 11A of the Prevention of Money Laundering Act (PMLA), 2002. This provision removes a major legal bottleneck and facilitates broader adoption across sectors.
Key Offerings of the e-KYC Setu System
The system offers a range of integration options and core services to suit different operational models. Regulated entities can opt for:

NPCI Web Interface: A ready-to-use, secure web portal

Android SDK: A plug-and-play kit for mobile-based integration

This flexibility allows REs to choose a technology stack that aligns with their business model—whether they operate branches, use customer-facing apps, or provide remote verification services.
Additionally, the e-KYC Setu System enables two types of authentication:

OTP-Based Authentication: Customers receive a one-time password on their Aadhaar-linked mobile number to verify their identity.

Face Authentication: Leveraging UIDAI’s Face Auth RD service, this method uses facial biometrics to authenticate customers, ideal for users without mobile connectivity.

How the e-KYC Setu System Works?
The operational flow of e-KYC Setu Services is simple, standardized, and designed for ease of use: 
The customer is first asked to provide consent on NPCI’s secure SDK interface. The customer inputs their Aadhaar number or Virtual ID (VID) through the secure NPCI application (via web or SDK). NPCI sends the Aadhaar data to UIDAI in real-time to perform authentication. Upon successful verification, UIDAI shares demographic details such as name, gender, DOB, and address—along with a masked Aadhaar number (last 4 digits)—with NPCI. The authenticated KYC data is securely transmitted to the requesting regulated entity, completing the e-KYC process without physical document handling. 
Key Features of e-KYC Setu
The e-KYC Setu System is equipped with several innovative features that make it both user-centric and regulation-compliant:

No Need for Gazette Notification: Regulated entities can use Aadhaar-based e-KYC services through this system without requiring an official Gazette notification in their name.

Single Window Onboarding: REs can onboard themselves onto the platform quickly through NPCI’s dedicated onboarding process, making the integration seamless.

Compliance-Friendly Privacy Controls: The system follows the guidelines of the Aadhaar Act and PMLA. It ensures that full Aadhaar numbers are never shared, only masked data is provided to REs.

Reduced Compliance Burden: By acting as an intermediary, NPCI handles Aadhaar data retrieval and storage compliance, thereby reducing the overhead for REs.

Customizable Tech Stack: REs can choose the preferred mode of implementation—web-based or SDK—for collecting Aadhaar and initiating the e-KYC flow.

Secure and Certified: Regular audits are conducted by CERT-In empaneled Information Security Auditors to ensure security and privacy compliance of the platform.

Benefits of Adopting e-KYC Setu
1. With e-KYC Setu, customers can now complete their KYC verification remotely, without the need for physical documents or branch visits. This enhances access to banking and financial services, particularly in rural or digitally underserved areas.
2. By eliminating paperwork and manual verification, regulated entities can significantly cut costs associated with KYC operations. Faster onboarding also leads to quicker customer acquisition.
3. Since full Aadhaar numbers are not shared with REs, the platform upholds privacy principles while enabling regulatory compliance. This drastically reduces the risk of data misuse or identity theft.
4. By conforming to the Aadhaar Act and PMLA norms, and by undergoing regular information security audits, the system allows REs to focus on customer service without worrying about legal lapses.
5. Real-time authentication drastically reduces the time needed to onboard new clients—accelerating everything from bank account openings to insurance issuance and investment registrations.
Use Cases Across Different Sectors

Banking Sector: Enables faster account openings and credit assessments with remote identity verification.

NBFCs: Facilitates quick disbursal of microloans and personal loans with verified customer data.

Insurance Providers: Speeds up policy issuance and claim processing with minimal paperwork.

Capital Markets: Reduces time taken to open DEMAT and trading accounts for retail investors.

Pension and Social Welfare Programs: Helps verify the identity of pensioners and beneficiaries without requiring physical presence or complex paperwork.

Telecom Companies: Uses face or OTP-based Aadhaar authentication for issuing new SIM cards or upgrading connections.

Getting Started with e-KYC Setu System
To integrate the e-KYC Setu System into your business operations, eligible regulated entities can initiate the onboarding process by reaching out to NPCI via email at ekycservices@npci.org.in. NPCI offers all the technical support, documentation, and integration kits required for a smooth deployment. Once onboarded, REs can use either the web portal or Android SDK to start performing e-KYC authentications. This single-window onboarding approach minimizes disruption to existing workflows and ensures that even non-tech-savvy organizations can quickly adopt the system. Once integrated, businesses can authenticate customer identities in a matter of seconds, ensuring both compliance and convenience.
FAQs
Q1. What is the E-KYC Setu System by NPCI? 
Ans. The E-KYC Setu System is a digital Aadhaar-based KYC platform developed by the National Payments Corporation of India (NPCI). It provides a secure and paperless way for regulated entities like banks, NBFCs, insurers, and mutual fund houses to verify customer identity through UIDAI authentication, without accessing or storing full Aadhaar numbers.
Q2. Who can use the E-KYC Setu System? 
Ans. Regulated entities (REs) under financial sector regulators such as RBI, SEBI, IRDAI, and PFRDA can use the E-KYC Setu System. This includes banks, non-banking financial companies (NBFCs), insurance companies, stockbrokers, and pension funds.
Q3. Is Gazette Notification required for using E-KYC Setu? 
Ans. No, regulated entities do not need a Gazette Notification under Section 11A of the PMLA, 2002, to use Aadhaar-based authentication through the E-KYC Setu System. NPCI has made it accessible to notified REs without additional legal hurdles.
Q4. What are the authentication methods supported by E-KYC Setu? 
Ans. The E-KYC Setu System supports two types of Aadhaar authentication:

OTP-based Authentication – using an Aadhaar-linked mobile number.

Face Authentication – through UIDAI’s Face Auth RD service.
 These options offer flexibility based on the customer’s preference and the RE’s operational model.

Q5. How is customer privacy protected in E-KYC Setu? 
Ans. Customer privacy is protected through masked Aadhaar sharing. NPCI only provides the last four digits of the Aadhaar number and demographic details like name, DOB, and address to the regulated entity. The full Aadhaar number is never shared, and all data is transmitted securely.
Q6. How can a regulated entity onboard with E-KYC Setu? 
Ans. Regulated entities can onboard through NPCI’s single-window onboarding process by emailing their interest to ekycservices@npci.org.in. NPCI provides all technical documentation, integration support, SDKs, and security guidelines for implementation.
Q7. What are the benefits of using E-KYC Setu? 
Ans. Key benefits include:

Instant customer onboarding

Paperless and contactless verification

Enhanced privacy and security

Reduced operational cost

Full regulatory compliance under Aadhaar and PMLA Acts

Recently, the National Payments Corporation of India (NPCI) has developed and implemented the e-KYC Setu System, a game-changing Aadhaar-based KYC platform for regulated entities in the financial sector. This system is specially designed to offer a one-stop digital solution to simplify the customer onboarding journey while ensuring compliance with Indian regulations. From banks and insurance companies to NBFCs and pension funds, this platform supports all regulated entities (REs) under RBI, SEBI, IRDAI, and PFRDA.

What is the e-KYC Setu System?

The e-KYC Setu System is a secure digital interface that enables seamless access to online Aadhaar-based e-KYC services. Developed under the provisions of the Aadhaar Act, this system allows financial sector entities to verify the identity of customers through UIDAI’s authentication services. Unlike traditional KYC methods that involve manual document collection, physical verification, and data entry, e-KYC Setu ensures a paperless, contactless, and privacy-protected verification process. What sets this platform apart is its ability to offer real-time identity verification while minimizing the operational burden of managing sensitive Aadhaar data. NPCI acts as a secure intermediary, sending Aadhaar authentication requests to UIDAI on behalf of the regulated entity and sharing masked identity data in return.

Who Can Avail e-KYC Setu Services?

The e-KYC Setu platform is available to Regulated Entities (REs) operating under various financial sector regulators in India. These include:

RBI-regulated banks and NBFCs
SEBI-registered capital market intermediaries
IRDAI-regulated insurance companies
PFRDA-regulated pension funds

Key Offerings of the e-KYC Setu System

The system offers a range of integration options and core services to suit different operational models. Regulated entities can opt for:

NPCI Web Interface: A ready-to-use, secure web portal
Android SDK: A plug-and-play kit for mobile-based integration

This flexibility allows REs to choose a technology stack that aligns with their business model—whether they operate branches, use customer-facing apps, or provide remote verification services.

Additionally, the e-KYC Setu System enables two types of authentication:

OTP-Based Authentication: Customers receive a one-time password on their Aadhaar-linked mobile number to verify their identity.
Face Authentication: Leveraging UIDAI’s Face Auth RD service, this method uses facial biometrics to authenticate customers, ideal for users without mobile connectivity.

How the e-KYC Setu System Works?

The operational flow of e-KYC Setu Services is simple, standardized, and designed for ease of use:

The customer is first asked to provide consent on NPCI’s secure SDK interface. The customer inputs their Aadhaar number or Virtual ID (VID) through the secure NPCI application (via web or SDK). NPCI sends the Aadhaar data to UIDAI in real-time to perform authentication. Upon successful verification, UIDAI shares demographic details such as name, gender, DOB, and address—along with a masked Aadhaar number (last 4 digits)—with NPCI. The authenticated KYC data is securely transmitted to the requesting regulated entity, completing the e-KYC process without physical document handling.

Key Features of e-KYC Setu

The e-KYC Setu System is equipped with several innovative features that make it both user-centric and regulation-compliant:

No Need for Gazette Notification: Regulated entities can use Aadhaar-based e-KYC services through this system without requiring an official Gazette notification in their name.
Single Window Onboarding: REs can onboard themselves onto the platform quickly through NPCI’s dedicated onboarding process, making the integration seamless.
Compliance-Friendly Privacy Controls: The system follows the guidelines of the Aadhaar Act and PMLA. It ensures that full Aadhaar numbers are never shared, only masked data is provided to REs.
Reduced Compliance Burden: By acting as an intermediary, NPCI handles Aadhaar data retrieval and storage compliance, thereby reducing the overhead for REs.
Customizable Tech Stack: REs can choose the preferred mode of implementation—web-based or SDK—for collecting Aadhaar and initiating the e-KYC flow.
Secure and Certified: Regular audits are conducted by CERT-In empaneled Information Security Auditors to ensure security and privacy compliance of the platform.

Benefits of Adopting e-KYC Setu

1. With e-KYC Setu, customers can now complete their KYC verification remotely, without the need for physical documents or branch visits. This enhances access to banking and financial services, particularly in rural or digitally underserved areas.

2. By eliminating paperwork and manual verification, regulated entities can significantly cut costs associated with KYC operations. Faster onboarding also leads to quicker customer acquisition.

3. Since full Aadhaar numbers are not shared with REs, the platform upholds privacy principles while enabling regulatory compliance. This drastically reduces the risk of data misuse or identity theft.

4. By conforming to the Aadhaar Act and PMLA norms, and by undergoing regular information security audits, the system allows REs to focus on customer service without worrying about legal lapses.

5. Real-time authentication drastically reduces the time needed to onboard new clients—accelerating everything from bank account openings to insurance issuance and investment registrations.

Use Cases Across Different Sectors

Banking Sector: Enables faster account openings and credit assessments with remote identity verification.
NBFCs: Facilitates quick disbursal of microloans and personal loans with verified customer data.
Insurance Providers: Speeds up policy issuance and claim processing with minimal paperwork.
Capital Markets: Reduces time taken to open DEMAT and trading accounts for retail investors.
Pension and Social Welfare Programs: Helps verify the identity of pensioners and beneficiaries without requiring physical presence or complex paperwork.
Telecom Companies: Uses face or OTP-based Aadhaar authentication for issuing new SIM cards or upgrading connections.

Getting Started with e-KYC Setu System

To integrate the e-KYC Setu System into your business operations, eligible regulated entities can initiate the onboarding process by reaching out to NPCI via email at ekycservices@npci.org.in. NPCI offers all the technical support, documentation, and integration kits required for a smooth deployment. Once onboarded, REs can use either the web portal or Android SDK to start performing e-KYC authentications. This single-window onboarding approach minimizes disruption to existing workflows and ensures that even non-tech-savvy organizations can quickly adopt the system. Once integrated, businesses can authenticate customer identities in a matter of seconds, ensuring both compliance and convenience.

FAQs

Q1. What is the E-KYC Setu System by NPCI?

Ans. The E-KYC Setu System is a digital Aadhaar-based KYC platform developed by the National Payments Corporation of India (NPCI). It provides a secure and paperless way for regulated entities like banks, NBFCs, insurers, and mutual fund houses to verify customer identity through UIDAI authentication, without accessing or storing full Aadhaar numbers.

Q2. Who can use the E-KYC Setu System?

Ans. Regulated entities (REs) under financial sector regulators such as RBI, SEBI, IRDAI, and PFRDA can use the E-KYC Setu System. This includes banks, non-banking financial companies (NBFCs), insurance companies, stockbrokers, and pension funds.

Q3. Is Gazette Notification required for using E-KYC Setu?

Ans. No, regulated entities do not need a Gazette Notification under Section 11A of the PMLA, 2002, to use Aadhaar-based authentication through the E-KYC Setu System. NPCI has made it accessible to notified REs without additional legal hurdles.

Q4. What are the authentication methods supported by E-KYC Setu?

Ans. The E-KYC Setu System supports two types of Aadhaar authentication:

OTP-based Authentication – using an Aadhaar-linked mobile number.
Face Authentication – through UIDAI’s Face Auth RD service.

These options offer flexibility based on the customer’s preference and the RE’s operational model.

Q5. How is customer privacy protected in E-KYC Setu?

Ans. Customer privacy is protected through masked Aadhaar sharing. NPCI only provides the last four digits of the Aadhaar number and demographic details like name, DOB, and address to the regulated entity. The full Aadhaar number is never shared, and all data is transmitted securely.

Q6. How can a regulated entity onboard with E-KYC Setu?

Ans. Regulated entities can onboard through NPCI’s single-window onboarding process by emailing their interest to ekycservices@npci.org.in. NPCI provides all technical documentation, integration support, SDKs, and security guidelines for implementation.

Q7. What are the benefits of using E-KYC Setu?

Ans. Key benefits include: