RBI Tightens Rules to Boost Security of Aadhaar-Enabled Payment Systems

The Reserve Bank of India (RBI) has announced fresh rules to improve the safety of Aadhaar Enabled Payment Systems (AePS). These new guidelines will take effect from January 1, 2026, aiming to curb fraud and strengthen trust in digital payments.

Why Are These Changes Needed?

In recent times, there have been growing cases of fraud in AePS. Criminals have used stolen identities and compromised customer details to cheat people. RBI said these steps are necessary to protect customers and ensure confidence in AePS, which is used widely for cash withdrawals and transactions using Aadhaar authentication.

What is AePS?

AePS is a system run by the National Payments Corporation of India (NPCI). It allows people to make transactions by verifying their Aadhaar number and fingerprint. The system has become very popular because it helps people in rural areas access banking services easily.

New Onboarding and KYC Rules for Operators

Banks that appoint AePS touchpoint operators must now carry out thorough background checks and due diligence before onboarding them. They will also have to update the operators’ KYC (Know Your Customer) records regularly.

If an operator does not do any transactions for 3 months in a row, the bank must perform fresh KYC checks before allowing them to operate again.

Stronger Risk Management and Monitoring

Banks must constantly monitor the activities of operators using transaction monitoring systems. They are required to set rules and limits for transactions based on the operator’s risk profile, which could depend on factors like location, transaction volume, and speed of transactions.

RBI also said banks must build strong technology controls to ensure any software or APIs are used only for AePS transactions and not for any other purpose.

Read More: RBI Pushes for Safer Digital Banking with Mandatory ‘.bank.in’ Domain by October 2025.

Conclusion

These new guidelines show RBI’s commitment to making Aadhaar-enabled payments safer and more reliable. As AePS continues to grow in popularity, these measures will help protect customers from fraud and ensure secure digital banking across India.

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