BENGALURU: The revised pricing suggested by the Unique Identification Authority of India for eKYC transactions is bound to sharply increase operational costs for companies using the architecture for electronic signatures (eSign) of documents.
According to industry executives in the business of authenticating documents, it could cause problems for early-stage tech companies who use eSign for financial documentation or for human resource onboarding.
While eKYC will be charged at Rs20 per transaction as per the latest gazette notification, for electronic signatures, which use the eKYC framework, charges could become as high as Rs25 per transaction, post the move. Previously, eSign by itself was charged at Rs5 per transaction.
At a technical level eSign, which allows multiple parties to come together and sign a document electronically, uses eKYC as a means of authenticating the parties as per provisions in the Information Technology Act, 2000.
“When eKYC is happening clubbed with eSign there is a need to relook into the pricing, Rs25 for electronic signature for every document becomes too much,” said Sanket Nayak, founder of Digio, which provides eSign facilities for financial institutions and others. “There is no debate around the need for pricing eKYC services, but I think the government agencies need to sit together and rationalise the pricing for clubbed services.”
Nayak said he intends to build an industry wide consensus around the issue and reach out to the Controller of Certifying Authorities (CCA) requesting it to discuss with the UIDAI and sort out the matter.
Another eKYC service provider, Mumbai based IDfy, also fears that early stageentrepreneurs could be affected. It may be pointed out that the entire Aadhaar India Stack platform was conceived as a free-to-use beneficiary platform for companies and customers. While charging to a certain extent is understandable, the range needs to be in tandem with the services offered.
“I think what people will also realise is that for most use cases, eSign is not really needed, so either the architecture of eSign will change to allow alternatives to eKYC or eSign will become redundant,” said Wriju Ray, cofounder of IDfy. Larger banks and fintech companies that rely on paperless processes to reduce cost of operations, however, do not mind the added price since the alternative is paper documentation.
“This move by UIDAI solves the ambiguity around eSign, that’s the first positive. Secondly, while it is true that our cost will go up, what it gives us is higher operational efficiency which is what I am okay with, since the alternate is physical signatures which makes the entire process cumbersome and expensive,” said Nithin Kamath, CEO, Zerodha.