According to UIDAI, a bank account cannot be opened with just the person's physical Aadhaar card or a photocopy of the Aadhaar. The PML Rules and RBI circulars state that the banks are required to do biometric or OTP authentication and due diligence before accepting Aadhaar for carrying out bank transactions or KYC for customers. If a bank does open one without it, it will be held responsible in case of loss.

In its recent FAQs released by UIDAI, the Aadhaar authority answered a question about if a fraudster can open a bank account using the copy of someone's Aadhar card without the holder's knowledge. The response was as follows:

One must keep in mind that a bank account cannot be opened merely on the presentation or submission of a physical Aadhaar card or its photocopy. Under the PML Rules and RBI circulars, to open a bank account, the bank is required to do biometric or OTP authentication and other due diligence before accepting Aadhaar for banking transaction or KYC. So no one can open a bank account in your name without your verification through biometric/OTP etc.

If however, a bank account is opened by accepting Aadhaar without biometric or OTP authentication and other verification, then the bank will be held responsible for any loss. An Aadhaar holder cannot be held responsible for the bank's fault. It is just like if some fraudster opens a bank account by presenting someone else's Voter card/Rationcard, it is the bank that would be held responsible not the voter or ration card holder. Till date no Aadhaar holder has suffered any financial loss on account of such misuse.