Banks might adopt Aadhaar as additional authentication or move to EMV (Euro pay MasterCard Visa) chip and pin technology to ensure security in card-based payment transactions, the Reserve Bank of India (RBI) suggested.

The central bank also said that all new card present infrastructures must be enabled with EMV chip and Pin technology as well as Aadhaar acceptance.

In a notification to the banks, the RBI said, "In respect of cards . banks may take a decision whether they should adopt Aadhaar as additional factor of authentication or move to EMV chip and Pin technology for securing the card present payment infrastructure."

Banks are now thus free to decide on whether they should adopt Aadhaar for making additional confirmation or make use of EMV Chip and PIN technology to ensure security of card payment infrastructure.

EMV chip and PIN authentication involves card-information stored in a chip that is accessible through a PIN (personal identification number) that replaces the signature of a cardholder.

The notification is based on Gowri Mukherjee-headed working group's recommendation. Mukherjee is the global head of digital marketing at Standard Chartered Bank.