You won't need to repeat KYC for new accounts or services with same bank

If you're already a customer of a bank and have completed your KYC (identity verification), you don’t need to go through the process again if you decide to open a new account or use other services with the same bank. The bank will use your existing KYC details. The Reserve Bank of India (RBI) recently updated its Know Your Customer (KYC) guidelines to align them with changes made to the Prevention of Money Laundering (PMLA) rules. 

 

The key points in the new amendments are as follows:

 

Centralized Record Keeping:

When banks update your KYC information (like your address or contact details), they must now send the updated information to a central government database (called the Central KYC Records Registry or CKYCR) within seven days. The CKYCR is a central database where KYC information for individuals and entities is stored in a digital format. The registry helps maintain a unified and updated record of customers across financial institutions.

 

This helps keep a single, up-to-date record of your information across all banks.

 

Better Customer Tracking:

Banks must now track your KYC details using a unique customer ID, called the UCIC (Unique Customer Identification Code). This makes it easier to identify and verify you, even if you have multiple accounts or products with the same bank.

 

Easier for Banks to Share KYC Info:

Banks will now be able to share your KYC details more easily with other financial institutions, as long as they follow the updated rules. This speeds up the process if you need to move between banks or financial services.

 

Faster KYC Updates:

If you provide updated KYC information (like a change in address), the bank must upload the changes to the central registry quickly—within seven days or within any other time frame set by the government.

 

Online KYC Records:

The central registry, CKYCR, stores your KYC information digitally, so it can be accessed by authorized institutions without the need for physical documents.

 

Customer Due Diligence (CDD) at the UCIC Level:

The RBI's revised guidelines mandate that Customer Due Diligence (CDD) procedures be applied at the unique customer identification code (UCIC) level. The UCIC is a unique identifier assigned to customers by financial institutions to track their transactions across different accounts and services. This means that if a customer who has already been KYC-verified wishes to open another account or avail of additional services with the same institution, there is no need to repeat the entire KYC process. As long as the customer is already identified, further KYC checks would not be necessary for new accounts or products.

 

Implications of the Changes:

 

Customers who have already gone through the KYC process will not be asked to provide the same documents again when opening new accounts or accessing other services with the same financial institution. This simplifies the process for both customers and institutions.

 

Financial institutions will be required to send updated KYC information to the CKYCR within a fixed timeline, enhancing the centralization and accuracy of customer KYC records.

 

The overall aim is to improve the efficiency of KYC compliance, reduce redundant documentation, and streamline customer onboarding and service access while still adhering to anti-money laundering (AML) regulations.

 

The RBI's changes are designed to make the KYC process smoother and quicker for customers, while also improving the way banks store and update customer information. The main benefit for you is that you won’t have to repeat the KYC process when accessing new services at the same bank, and your updated details will be easier to track.