KYC: RBI Announces Changes In KYC Rules, Here’s How It Will Affect You

Digital KYC service is now available through banks, allowing customers to connect with the bank online and submit a live photo.

RBI to Modify KYC Rules  
The Reserve Bank of India (RBI) has recently introduced a new set of guidelines for KYC (Know Your Customer), with several updates aimed at preventing financial fraud. These new changes will make the process of verifying customer identities simpler.

What is KYC?
KYC stands for “Know Your Customer,” which includes details like your name, identity, and residential address. KYC is essential for opening a bank account, and guidelines have been established to combat money laundering and terror funding. Under the updated guidelines, customers will now need to provide proof of their current address along with a recent photo. Accepted proofs include a driving license, passport, voter ID, and PAN card, which must be submitted as photocopies to the bank.

What is Digital KYC?
Digital KYC is a service that banks offer, allowing customers to interact with the bank online and submit a live photo. Documents like an Aadhaar card can also be uploaded this way. Customers may upload a photo of their residence building as well. This digital KYC process helps to secure your account further.

Key Changes in KYC Rules
Banks and financial institutions now complete the KYC requirements while opening new accounts.  
For high-risk accounts, special monitoring is conducted.  
Customers are now allowed to update their KYC details after a specific period.  

Central KYC Record Sharing  
As per the new rules, financial institutions are required to share updated KYC information with the Central KYC Registry. After receiving updated KYC information, banks and financial institutions must share it with the Central KYC Registry within seven days. By using the KYC identifier, financial institutions can retrieve customer KYC without needing the same documents repeatedly.

Why Are These KYC Changes Important?
These updates in KYC rules are designed to simplify and streamline the KYC process. This creates a secure data system within institutions and helps prevent financial fraud. Financial Express has reported on this development.

How Will These Changes Affect Customers?
As a bank customer, you can open your bank account more quickly.  
The new rules simplify the process of filling in KYC information.  
The biggest advantage of these changes is increased customer security.