What is KYC | KYC process | KYC full form | and How Does it Work? 2022

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What is KYC, KYC process, KYC full form is (Know your Customer) KYC form

What is KYC

What is KYC
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What is KYC

Considering the increasing rate of financial malpractices, RBI has made it mandatory for every individual and financial institution to complete the KYC process before extending any financial services. The aim of introducing this verification process is to establish the authenticity of a borrower and curb the illegal monetary activities and financial frauds that occur from time to time.

In accordance with RBI’s guidelines, financial institutions have drafted a list of documents that every customer needs to submit. After that, they will go through and validate these papers and then authorize any loan or any other financial service.

Now that you have an idea of what is KYC, you should also learn the papers you need to keep handy and how this process works to conclude it without fail.

KYC process: Documents needed for the completion of KYC

A point to remember here is that not every identity proof issued by the government or government-registered organizations is suitable for this procedure. According to RBI’s norms, the following is a list of documents that are officially accepted for KYC verification across this country –

  • Aadhaar card
  • Voter’s ID card
  • Driving license
  • Passport
  • PAN card

Hence, if you plan to apply for a personal loan, or any other financial products, keeping these documents within reach can simplify the due process.

Moving ahead, there are two ways of completing a KYC verification process, online and offline. Knowing about both methods can aid applicants to finish it without any difficulty.

E KYC verification online: What is KYC

Here is a summary of how an E KYC process works –

Step 1: Gathering information

The first step of this process is to gather the needed details. Nonetheless, the authenticity of this information is subjected to due diligence. Individuals need to fill up an online registration form on a portal of their preference.

Step 2: Uploading associated documents

After entering the personal information, individuals need to upload supportive documents. They can scan and then upload the soft copies of their identity proof, address proof, and other details on a portal of their choice. Moreover, failing to provide proper documents is one of the mistakes to avoid while applying for a personal loan.

Step 3: Verification

After uploading these documents properly, a verification process is initiated to confirm the legitimacy of these papers. Primarily, these documents are matched against the information mentioned by individuals and check if they are offering similar details or not.

Following this verification, different checks are carried out to test any evidence of tampering with these documents. After this check and consequent clearance, required data from these papers are extracted. This process works in two ways –

  • OCR is one of the ways to validate the information. It is an automated method where the system will get needed details and then verify them to spot any anomalies.
  • Individuals can also complete it manually by entering their details into an online portal. The IDV solution built in this system will then verify information against the provided documents to affirm its validity.

Completing this KYC process online beforehand is one of the best tips to take out personal loans without any interruptions.

Offline KYC verification

The offline KYC process includes similar steps, but applicants must submit a physical copy of their papers. Here are the steps –

Step 1: Download a KYC form from the website of respective financial institutions.

Step 2: Duly fill up this form and put special emphasis on PAN or Aadhaar numbers and spelling. Also, submit a photocopy of needed documents with this application form.

Step 3: Visit the nearby KRA and submit this form with ID proof.

Step 4: Besides submitting identity proof, individuals need to complete a biometric scan.

Step 5: After finishing this procedure, individuals will get an application number that they can use to keep track of their verification status.

This verification process is a time-consuming one. However, its duration depends on whether there are any issues with an application or not. Hence, completing this process is imperative to avoid delays in applying for a personal loan.

However, to manage a loan application process and save time, financial institutions like Bajaj Finserv extend pre-approved offers. Such offers are available on financial products like personal loans, business loans, credit cards, and many others. Intending borrowers can now check their pre-approved offers by submitting their essential contact information.

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Finishing the KYC process without fail is vital to avail of any financial service. In this regard, applicants should also be wary of the verification process of a personal loan to circumvent any chances of failing.

About zikraproduction92 323 Articles
My name is Rja Anwar shaikh and I am a blogger, digital marketer, and creator. I started by doing these jobs for money. Wonder how I Built up my personal website name "www.zikrainfohub.com" My blog Upcoming Thoughts evolved from my own personal thoughts scattered, About Business, how to make money online, and education, and soon became an influential member of YouTube.

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