Know Your Customer (KYC) is a mandatory process used by all banking and financial institutions to verify new customers’ identities. In recent times, digital innovations and permissions from the Reserve Bank of India have made it easier for customers to complete this process via video KYC verification.
In this blog, we explore the process of video KYC in more detail, including various aspects of this digital mode of verification.
Understanding The Process of Video KYC
The RBI has recently approved using the Video-based Customer Identification Method (V-CIP) to achieve paperless KYC. In this process, individuals can carry out remote KYC from the comfort of their homes via a video call. Unlike conventional KYC methods, the authorised verification agency verifies the records, performs a detailed search, and determines the person’s location through video calls.
Here is how the process of video KYC generally works –
● Once the video KYC is scheduled, the customer will get an automatic text message or email containing a joining link.
● The customer has to join a video call with a bank representative.
● The bank representative will then do OSV verification of the consumer’s original government-issued documents.
● The customer’s address validation will be done using their live location.
● Once the video KYC is done successfully, the consumer will be notified via email and text message.
What Do You Need For Video KYC?
Given below are some of the things that you need to carry out video KYC services –
● A smartphone with stable mobile network connectivity
● Original PAN card
● Physical presence in India
How To Do Video KYC Online?
Here’s the detailed process through which you can do your video KYC online –
● Complete your digital account opening through Aadhaar OTP based E-KYC.
● Give consent for the Video KYC option and click on the video KYC link. This link is also sent via SMS and is valid for seven days from the time it is generated.
● On the scheduled date and time, click on the link to start your Video KYC and allow the camera, microphone, and location access.
● Let the banking official click your photograph, verify your original PAN, and take your signature once you are connected.
Advantages of Video KYC in India
Among some of the key advantages of video KYC verification in India include –
● It allows customer verification using the latest techniques such as automated data extraction, facial matching, and machine learning techniques, all in real-time.
● All customer interactions are recorded and stored for future reference.
● The process for video KYC can be easily done from the comfort of your home. All you need is a laptop/smartphone/tablet with a working internet connection.
● The process helps onboard customers extremely fast using Artificial Intelligence (AI)
● The process reduces customer onboarding costs by 90% and drastically reduces turnaround time from several days to just a few minutes.
How Does Video KYC Work For Different Business Verticals?
In this section, we will understand how different sectors can use the provision of video KYC to their advantage –
Banks and Insurance Providers
Completing KYC for account opening or SMS alerts or to avail of other banking services is a mandatory compliance requirement for banks to prevent identity theft and money laundering. KYC services offer a great alternative that allows bank customers to do their KYC from the comfort of their homes and makes it easier for bank officials while saving their time.
Instead of investing in field agents and running from door-to-door to collect address proof and identity proof, officials can do it all from a single location. With video KYC for e-wallets and digital payments, you get the advantage to increase your customer base and penetrate multiple locations without incurring a huge cost. It also ensures customers’ convenience at the same time through a much faster KYC process.
With video KYC for mutual funds, you can easily capture details of all your customers electronically to verify their identity and enable them to open a Demat account to invest in the stock market. It allows mutual fund companies to significantly increase their customer outreach and speed up the customer onboarding process with a Video-based KYC solution, making it easy and much more productive for mutual funds platforms.
With a video-based customer identification process, players can make paperless banking a reality for NBFCs, fintech and other small financial banks and lenders. It enables the regulated entities to easily carry out remote onboarding while reducing the overall KYC process to minutes instead of days. Further, it can reduce their costs substantially by eliminating the need to go out to customers, thus making small ticket accounts more profitable.
How Will Video KYC Impact Us In Future?
Some of the key ways that video KYC will impact and benefit us in the future include –
● Effectively dealing with criminal activities such as money laundering
● Prevents fraudulent scams and malicious activities from taking place
● Making sure that investor assets are safe from fraud
● Helps reduce paperwork
● Creates a streamlined process through automation
● Extremely cost-effective
The Future Of Video KYC
Today, leading verification players have launched their video KYC verification product to help users submit KYC information easily and get themselves verified via a video call. It helps improve customer experience and save on several KYC costs while reducing onboarding time to just a few minutes.