Knowing your customer, also known as KYC, is a procedure that must be followed before allowing prospective customers to get access to services. During this process, the personal information of potential consumers is checked, validated, and confirmed to be true and genuine. The Know Your Customer (KYC) procedure is already generally established across the banking and financial services industries, and it really is gaining support across the telecom, mobility, and eCommerce sectors as well.
The institutionalization of know your customer processes has assisted businesses and service providers operating in various industries in reducing the amount of fraud as well as cybercrime that occurs. On the other hand, the manual procedure has traditionally been laborious, time-consuming, and financially prohibitive.
The Know Your Customer (KYC) procedure is increasingly being carried out digitally thanks to eKYC, also known as online KYC. The Know Your Customer (KYC) process as a whole has sped up, gotten more streamlined, and become more efficient because of developments in technology.
Automating the Know Your Customer (KYC) process allows for a more streamlined, problem-free onboarding as well as servicing experience for both new and existing clients. Additionally, for service providers, this appears to mean fewer instances of human error and a less resource-intensive procedure for this mission-critical procedure.
The Value and Advantages of Performing KYC
The Know Your Client (KYC) procedure, in addition to being required by law, is beneficial to financial institutions in a number of different ways, including the following:
Assists lending institutions in carrying out risk analysis by elucidating the borrower’s preceding financial history as well as the assets currently held.
Reduces the amount of fraud that is caused mostly through identity concealment
Helps to eliminate money laundering along with other unethical practices
Provides stability to the nation as well as investment opportunities since it makes the country’s financial system more reliable and less dangerous.
As a result of less unpredictability, financial institutions are able to raise the amount of money they lend to consumers and hence their earnings.
KYC documents list
As per the kind of KYC, the needed papers must either be supplied in hard copy or as a scanned copy of the original document. The Know Your Customer process necessitates the submission of two major categories of documents: verification of identity as well as proof of address. These categories sometimes overlap, but in general, they are separate. The following items constitute the needed KYC documents list :
To Establish One’s Authenticity
The UID is also known as a unique identifying number that is associated with each individual’s Aadhar card. You could also use your passport, driver’s license, or voter ID as an alternative form of identification.
Your picture identification card (PAN)
The necessary KYC documents list includes a photograph of the applicant. This document must be issued by either the state or the central government.
A document proving one’s identification can be obtained from banking institutions, public sector companies, or any public financial organization.
To Serve as Proof of Address
It is necessary to present a voter’s card, passport, or driver’s license in addition to a registered sales contract; alternatively, a lease on a dwelling or an upkeep bill for a flat would suffice.
Your statement for water use, as well as your bill for electricity or gas, telephone service, and other utilities, is also legitimate. These invoices must be more than three months old at the time of purchase for providing a list of KYC documents.
A self-declaration that is issued by the judges of the supreme or high court provides the applicant with a new address that may be necessary for the event that the applicant is condemned for whatever reason.
Evidence of address for KYC can also be provided by any of the following units: the bank supervisors of Scheduled co-operative banks or timetabled financial institutions; Gazetted Officers; Internationally active Foreign Banks; Notaries public; Documents issued by any Statutory Authority or government; any members of congress that have already been elected to the Legislative Assembly or Parliament.
Conclusion
Applicants, as well as customers, may be certain that the onboarding procedure to avail of banking services will be reasonably hassle-free so long as they possess the proper papers for KYC documents list that are required for completing their KYC verification and that are still valid.
