Kyc India: A Comprehensive Guide to Know Your Customer

In India, KYC (Know Your Customer) regulations are in place to prevent money laundering and ensure financial institutions verify the identities of their customers. The Reserve Bank of India (RBI) mandates KYC compliance for all banks and financial institutions.

The RBI's KYC guidelines require financial institutions to collect and verify customer identification documents, such as a valid government-issued ID and proof of address. This ensures that customers are who they claim to be and helps prevent identity theft.

KYC regulations in India also require financial institutions to maintain customer due diligence records, which include information such as customer identification, contact details, and transaction history. This information is used to monitor customer activity and detect any suspicious transactions.

KYC, or Know Your Customer, is a process that financial institutions use to verify a customer's identity. It's a requirement for every new financial service request, even if the customer has undergone KYC multiple times before.

Every time a customer requests a new financial service, they have to go through the KYC process again, which can be repetitive and time-consuming. This is where cKYC comes in to simplify things.

cKYC stands for Central KYC, and it's a centralized registry that stores a customer's KYC records in a central database. This database is managed by the Central KYC Records Registry (CKYCR) under the Central Registry of Securitisation Asset Reconstruction and Security Interest (CERSAI).

In India, there are several types of KYC processes that are compliant with RBI regulations. Aadhaar eKYC is one of them, which uses Aadhaar data to verify a customer's identity. It can be done online or offline.

Online Aadhaar eKYC can be OTP-based or biometric, while offline eKYC can be done using an Aadhaar XML file or by scanning the QR code at the back of an Aadhaar card. This mode of KYC is paperless.

Video KYC is another type of KYC process that involves a video call and a review stage. The RBI deems video KYC to be fully compliant with physical KYC.

Central KYC, or cKYC, involves a FI using the customer's KIN to access their documents from the central KYC registry. This process is convenient for both the customer and the institution.

The KYC process in India has undergone significant changes, making it more efficient and convenient for customers. eKYC, or electronic KYC, is a paperless alternative to the traditional KYC process.

It leverages digital systems to verify a customer's identity based on their Aadhaar number, making it quicker and more convenient. The Unique Identification Authority of India (UIDAI) provides the infrastructure to facilitate eKYC.

To complete the eKYC process, customers undergo Aadhaar eKYC and PAN number and NSDL check, which takes just a few minutes. They can then pick a suitable time for vKYC, where an official representative verifies their identity over a video call.

Here's a brief overview of the vKYC process:

For customers whose KYC details are due for an update, financial institutions send reminders via email, SMS, or other registered communication channels.

eIDM is a digital form of identification that can be used for various purposes, including the KYC process. It's essentially a digital version of a physical ID card.

Anyone who has an Aadhaar card and a mobile number linked to it can use eIDM. This is because the Aadhaar card is the basis for eIDM, just like it is for eKYC.

eIDM can be used for verification purposes, similar to eKYC. A customer's information can be received from the UIDAI's database for verification.

An Aadhaar XML is a password-protected file that contains a customer's basic demographics. This file can be downloaded from UIDAI's portal after completing an Offline eKYC form.

The Aadhaar XML file can be shared with Financial Institutions (FIs) for verification purposes, along with a share code.

The KYC process can be broken down into several steps.

The Video KYC process starts with the customer undergoing 'Aadhaar eKYC' and 'PAN number and NSDL check' before scheduling a video call.

In Video KYC, the official representative facilitates real-time document capture, OCR, liveness detection, and a 'face and name match' during the video call.

The video call and data captured are reviewed by another official representative to complete the vKYC process.

There are also digital Re-KYC options available for low-risk customers, which can be completed through Internet Banking, mobile apps, or ATMs.

Here are the Re-KYC process steps:

You can renew your KYC using various modes, including Video KYC, db Online Banking, visiting the branch, or email.

The eProcess is a game-changer for KYC in India. It's a paperless and efficient alternative to the traditional KYC process, leveraging digital systems to verify a customer's identity based on their Aadhaar number.

The Unique Identification Authority of India (UIDAI) provides the infrastructure to facilitate eKYC. This means you can say goodbye to long queues and hello to quicker and more convenient identity verification.

To renew your KYC using the eProcess, you can use Video KYC, db Online Banking, or visit your home branch. You can also renew your KYC by email, but this requires you to submit your documents and KYC renewal form.

Here are the steps to renew your KYC using the eProcess:

Offline eKYC is another option, which provides a way for customers to verify their identity without needing an internet connection or real-time access to UIDAI's database. This is done through either an Aadhaar XML File or a QR Code Scan.

Video content plays a crucial role in the KYC process. It's a convenient way for customers to verify their identities remotely, eliminating the need for in-person visits to branches.

Video KYC is an online, real-time verification process that confirms a customer's identity over a live video call with a bank or financial institution representative. This method is becoming increasingly popular due to its efficiency.

The video call is a live interaction, allowing the representative to verify the customer's identity in real-time. This process is designed to be secure and reliable.

Aadhaar Card, Driving License, Passport, and Voter ID Card can be used as both proof of address and proof of identity for KYC.

In India, specific documents are required for the Know Your Customer (KYC) process. These documents help financial institutions verify the identity and address of customers.

Documents like PAN Card, Photo ID Card issued by the Central/State Government, and Photo ID Card issued by the Public Financial Institutions can serve as proof of identity.

For proof of address, one can use documents such as Registered Agreement for Lease or Sale of Residence, Utility bills not older than three months, and Bank account statement not older than 3 months.

Some documents that can serve as proof of address include ID card with address issued to members by professional bodies such as ICAI, ICSI, Bar Council, etc., and Land or municipal tax receipt.

The RBI has established specific norms and guidelines for KYC, which include the list of acceptable documents for KYC renewal.

There are several types of KYC verification methods in India.

Aadhaar eKYC is one of them, which uses Aadhaar data to verify a customer's identity. It can be done online or offline. Online Aadhaar eKYC can be OTP-based or biometric (retina or fingerprint) based.

Offline eKYC can be done using an Aadhaar XML file or by scanning the QR code at the back of an Aadhaar card. This is a paperless mode of KYC.

A digital KYC requires an official representative to be physically present with the customer at the time of verification. They capture 'live' images of the customer and their documents, which are then verified against the customer's application.

Video KYC is another method, which consists of two stages - a video call and a review. In the first stage, an official representative captures the customer's POI and POA over a video call. The second stage involves a review of the video call by another representative.

The RBI deems video KYC to be a fully compliant mode of KYC, on par with physical KYC.

To apply for online e-KYC, you can visit the website of the KYC Registration Agency and log in using your mobile number after scanning and uploading your documents.

The following are the different types of KYC verification methods:

Re-KYC is a process designed to ensure that customer information remains accurate and up-to-date over time. Financial institutions, particularly banks, are required by the Reserve Bank of India (RBI) to periodically update customer details, especially for accounts that are classified as high-risk.

The RBI guidelines specify that customers are categorized into three risk categories: high-risk, medium-risk, and low-risk. The high-risk category undergoes re-KYC once every 2 years, while the medium and low-risk ones undergo it once every 8 and 10 years respectively.

Customers who fall into the low-risk category don't have to visit the bank for re-KYC. They can get it done via Internet Banking, the bank's mobile application, or through a re-KYC update link provided through their registered email ID or mobile number.

The re-KYC process consists of 3 key steps: filling a re-KYC form, submitting self-attested copies of acceptable identity and residential proof, and processing the re-KYC in about 10 days.

To maintain compliance with Anti-Money Laundering (AML) guidelines, institutions are mandated to periodically verify and update customer data. This helps prevent fraud, maintain compliance, and enhance customer safety.

Here are the key intervals for re-KYC based on the customer's risk profile:

Regular updates help protect customers from unauthorized transactions or identity theft, and ensure the safety of the financial system. By keeping customer details updated, financial institutions reduce the risk of fraud or misuse of accounts.

KYC for Individuals is a crucial step in the process of verifying one's identity. This process is mandatory for all Indians and involves providing required documents to prove one's identity and address.

You'll need to provide a government-issued ID, such as a Aadhaar card, passport, or driving license, as proof of identity. The document must be valid and not expired.

Some individuals may also be required to provide proof of address, such as a utility bill or a bank statement, to ensure they are not using a fake identity. This helps to prevent money laundering and other financial crimes.

As an individual, you'll need to provide specific documents to complete the KYC process.

The RBI has specified a set of Officially Valid Documents (OVDs) that can serve as both Proof of Identity (POI) and Proof of Address (POA). These documents include Aadhaar Card, Passport, Voter ID Card, Driving Licence, and PAN Card.

If you're submitting a document that contains both identity and address details, you won't need to provide additional documentation. However, if the Proof of Identity document doesn't include your address, you'll need to submit a separate Proof of Address.

The most widely accepted ID in India is Aadhaar, which can be verified electronically using your 12-digit number and consent for a service provider to use your data.

To verify your identity using Aadhaar, the service provider will send your Aadhaar number to the Unique Identification Authority of India, which will respond with demographic information such as name, address, and phone number.

If you're using a PAN Card, it's a unique, 10-digit alphanumeric code issued by the Income Tax Department to Indian taxpayers who are 18 or older.

Here are the accepted documents for individual customers:

If you fail to complete the Re-KYC process, your financial institution may take action to protect itself and prevent potential risks. Financial institutions may impose a partial freezing on your account.

Initially, you'll be allowed to make credits, but debits will be restricted. This is a warning sign that you need to take action to update your customer information.

If you still don't complete the Re-KYC process within a certain timeframe, both credits and debits will be disallowed, making your account inoperative. This means you won't be able to access your account until you comply with the requirements.

To reactivate your account, you'll need to complete the Re-KYC process by submitting the required documents. This ensures your customer information remains accurate and up-to-date, just like the RBI requires.

KYC for Businesses is a crucial process that helps regulated entities verify the identity and legitimacy of businesses before they open accounts. This process is essential to prevent money laundering and other financial crimes.

To perform KYC on a business, you'll need to submit specific documents depending on the type of business. For example, partnership firms need to submit their partnership deed, registration certificate, and PAN of the business, as well as complete KYC for individual partners and authorized signatories.

Proprietary concerns, on the other hand, must submit two of the following documents as proof: certificate of incorporation, articles of association, board resolution authorizing account operations, and KYC details of the directors and authorized signatories.

Corporations require a more extensive set of documents, including their certificate of incorporation, articles of association, board resolution authorizing account operations, and KYC details of the directors and authorized signatories.

Here's a breakdown of the required documents for each type of business:

In India, regulated entities must also perform KYC on businesses, which includes identifying and verifying the company's certificate of incorporation, memorandum and articles of association, company PAN, authorization to transact on the company's behalf, beneficial owners, senior management, and registered office.

eKYC has revolutionized the way we verify identities in India. It can be completed in a matter of minutes, unlike traditional methods that may take days.

With eKYC, customers can complete the process from the comfort of their homes or anywhere else, without needing to visit a branch. This convenience is a game-changer for people with busy schedules or those living in remote areas.

eKYC is a secure process, using encrypted data transfers to protect the customer's identity and personal information. This is especially important in today's digital age, where security is a top concern.

Here are some key benefits of eKYC at a glance:

In addition to eKYC, cKYC also offers several benefits. With cKYC, customers can undergo the KYC process only once, even if they apply for various financial products with different institutions.

This reduces redundancy and saves time and resources for financial institutions. They can directly access the customer's KYC information from the central registry instead of conducting the process from scratch.

cKYC also enhances customer convenience by eliminating the need for customers to provide their KYC documents repeatedly. This makes the onboarding process faster and smoother.

By using cKYC, institutions can ensure compliance with the latest regulations. The central registry is regularly updated, so institutions can rely on it for accurate and up-to-date information.

In India, the Know Your Customer (KYC) process requires customers to submit specific documents to verify their identity and address. These documents help financial institutions ensure the legitimacy of the individuals or businesses they are engaging with.

Depending on the type of customer—individuals, minors, non-resident Indians (NRIs), or businesses—the required documents may vary. This ensures that financial institutions are complying with RBI regulations and maintaining the safety of the financial system.

To prevent fraud and unauthorized transactions, it's essential to keep customer details updated. Regular updates help protect customers from identity theft and maintain compliance with Anti-Money Laundering (AML) guidelines.

Here are some examples of required documents for different types of customers:

KYC is a standard due diligence process that helps banks and financial institutions ensure customers are who they claim to be. It's a crucial step in protecting against financial fraud.

The Reserve Bank of India introduced KYC guidelines in 2002 to safeguard against money laundering, terrorism funding, and identity theft. These safety nets are enforced by law.

Non-compliance with KYC norms can result in heavy penalties from market regulators. This has been a recurring issue in the past.

To verify a customer's identity, they must be physically present at the bank or financial institution. They'll need to submit self-attested copies of proof of identity and proof of address.

To comply with KYC norms in India, you'll need to provide specific documents. These documents can be used as both proof of address and proof of identity.

For proof of identity, you can use documents like a PAN Card, Photo ID Card issued by the Central/State Government, or a Photo ID Card issued by Public Financial Institutions. These documents are widely accepted.

Some examples of proof of identity documents include:

For proof of address, you can use documents like Registered Agreement for Lease or Sale of Residence, Utility bills not older than three months, or Bank account statement not older than 3 months. These documents are commonly accepted.

Some examples of proof of address documents include:

In India, the cKYC registry integrates with Aadhaar and PAN databases to provide a more comprehensive KYC process. This integration allows customers to streamline their verification process by linking their Aadhaar or PAN numbers to the centralised KYC record.

Customers who provide their Aadhaar or PAN details can further simplify their verification process.

KYC Authentication is a crucial step in the KYC process in India. It involves verifying the identity of customers through various means such as government-issued ID cards, passports, and driving licenses.

The government of India has made it mandatory for businesses to obtain KYC documents from their customers. This includes documents like PAN cards, Aadhaar cards, and passport.

In India, the KYC process is regulated by the Prevention of Money Laundering Act (PMLA) and the Income Tax Act. These laws require businesses to maintain accurate and up-to-date records of their customers' identification documents.

The KYC authentication process typically involves collecting and verifying customer information through various channels, including online and offline means. This helps to reduce the risk of identity theft and money laundering.

In India, the Aadhaar card is a widely accepted and mandatory document for KYC purposes. It contains unique biometric information that helps to verify a customer's identity.

Navigating the complexities of KYC compliance in India can be a challenge, but Trulioo's state-of-the-art technology and local expertise can help organizations streamline the process.

The RBI has outlined multiple types of KYC processes that are compliant with regulations, giving institutions a range of options to choose from.

Trulioo's in-house verification capabilities cover the world, eliminating the need for multiple point solutions and allowing organizations to blend business and person verification for deep insights into entities and their beneficial owners.

Companies can combine data and document verification to ensure their onboarding processes align with a customer's risk level, automatically routing users to the verification service that best fits any scenario.

By leveraging Trulioo's onboarding workflows, organizations can adapt to shifting regulations and evolving fraud threats as they expand across borders.