With the Reserve Bank of India permitting payments banks and small finance banks to rely upon electronic authentication while opening accounts and for other transactions, there is an incentive for more people to get digital signatures.
It will help reduce costs and bridge the gap between the customer and service provider, says Paytm Payments Bank chief executive Shinjini Kumar.
One way of electronic authentication is through digital signatures, which can be obtained from certifying authorities. Individuals use them for electronic filing of income tax returns.
A digital signature eliminates the need for exchange of documents to complete any transaction. It is also used by heads of companies while applying for loans, among other things. But there is a cost involved. It can range from Rs 1,000 to Rs 2,000, depending on the kind of signature and the validity. It is valid for one or two years and has to be renewed after that.
The kind of signatures varies depending on the security. For instance, Class-I signature will confirm the user's name and email address. Class-II will confirm that the information provided by the subscriber does not conflict with information in consumer databases. Class-III will be issued only if the individual appears before the certifying authorities. To get a digital signature, customers need documents to show proof of identity and proof of address.
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