PAN 2.0 project to reduce costs for fintech companies: experts
T
he implementation of the PAN 2.0 project, announced on Monday by the Centre, is expected to lower costs for fintech companies, according to industry experts.
Sanjeev Mehta, former Managing Director at Standard Chartered Bank and now leading a Greenfield startup venture, praised the Cabinet's approval of PAN 2.0 project. "This is a transformative move that will help fintech and other companies reduce costs while streamlining operations," he said.
Mehta emphasized the importance of consolidating databases currently maintained by two authorities--Protean eGov Technologies Ltd (formerly NSDL) and UTI Infrastructure Technology and Services Limited (UTIITSL)--into a unified system.
"The project will enable a single source of truth and a unified identity for consumers. With a single interface and integration, it eliminates the complexities of maintaining multiple systems. This has been a long-standing demand from the industry," he said.
At present, both Protean and UTIITSL are authorized to issue PAN cards and offer online and offline services for new applications, corrections, updates, and tracking. Under PAN 2.0, new PAN cards will be issued using the upgraded system, and existing PAN data will be merged into a centralized database.
Mehta highlighted that fintech companies and banks rely heavily on PAN for authentication, database monitoring, and underwriting processes. "From a credit perspective, this single system will streamline integrations and ensure reliable verification of PAN credentials, enhancing the overall credit ecosystem."
He also clarified that while existing PAN cards will remain valid, individuals can upgrade to a new PAN card featuring added functionalities such as QR codes and updated designs. "The PAN number will remain the same, but users can opt for a refreshed version with modern features. The migration to the new system will happen automatically for all existing PAN holders," Mehta said.
Dr. Vimal Joshi, a corporate lawyer and Supreme Court advocate, said the PAN 2.0 project is expected to address the issue of PAN card duplication effectively.
"With a single authority issuing PAN cards, instances of duplication will be eliminated. This will also help reduce litigation, as many court cases currently involve individuals using multiple PAN numbers."
Joshi said that the PAN 2.0 project marks a critical step in enhancing India's financial infrastructure, streamlining processes, and boosting efficiency for businesses and individuals alike.
On Monday, the Cabinet approved PAN 2.0 Project of the Income Tax Department. The financial implications for the PAN 2.0 Project will be Rs. 1,435 crore.
PAN 2.0 Project enables technology-driven transformation of taxpayer registration services.
✔️ PAN 2.0 project to reduce costs for fintech companies: experts
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