PAN cards will now also be used for identity verification. In fact, according to the revised technical guidelines issued by the Insolvency Regulator on Wednesday, the Insolvency and Bankruptcy Code includes the PAN card at par with other officially valid documents, so that the identity of the users can be verified. Information utilities store financial information about debtors in electronic databases eliminate incorrect information, and reduce delays and disputes in bankruptcy proceedings. Experts say that making the PAN card valid for identity verification will make the financial process easy to complete. This will benefit on a large scale.

As per the revised guidelines issued by the Insolvency and Bankruptcy Board of India (IBBI), information utilities are required to obtain a sub-authentication user agency license from the Unique Identification Authority of India (UIDAI) for demographic authentication of users during the registration process.

Information on corporate debtors will be required.

The Insolvency and Bankruptcy Board of India (IBBI) has now ordered information utilities (IUs) to use PAN or any other official document to verify the identity of users who want to access information about corporate debtors. Under the Insolvency and Bankruptcy Code (IBC), IUs are required to maintain an electronic database of information on any CD, including records of its loans, balance sheet and cash flow statement, assets, etc. Experts say that overall, the amendment reflects a proactive and pragmatic approach to the IBBI, making the mechanism more transparent with seamless processes and procedures.

The government has come up with PAN 2.0

The government has come up with PAN 2.0. PAN 2.0 will be similar to the m-Aadhaar or e-Aadhaar system. Now the question in your mind is whether PAN 2.0 will have dynamic QR codes for KYC, identity verification, or address proof purposes. Let us tell you that the PAN card serves as both a tax identifier and a physical identity proof. Under the new PAN 2.0 project, the system is being converted into a digital format. The government has allocated Rs 1,435 crore for a comprehensive upgrade of the existing PAN infrastructure. The government has said that PAN 2.0 will be an advanced version that will enhance user convenience. Currently, the electronic version of PAN 1.0 has limited KYC applications and cannot serve as address proof in any form.

Experts believe that additional clarification is needed about the dynamic QR code features of PAN 2.0, especially its ability to display residential information. "In its current form, PAN is necessary but not sufficient for KYC. It is not classified as an OVD (officially valid document); rather it is a unique identifier used for tax and anti-money laundering purposes. In addition to collecting the PAN (ie the number) the regulated entity must still collect an ID card (OVD). Though the current PAN card format does not meet KYC requirements, its linking to Aadhaar can enable KYC verification.

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