KYC norms were introduced in 2002 by the Reserve Bank of India(RBI) and has ever since been used at banks by taking KYC documents in accordance with certain guidelines issued by the RBI from time to time with the main objective to prevent criminal activities such as money laundering of Banks, terrorist financing and theft, intentionally and unintentionally.KYC as in Know your customer enables BFSI to know who their customers are and also understand their financial dealings .it is the process of identifying and thus verifying the identity and address of its clients or investors in business terms.
Filing a KYC document has become a mandatory procedure today. The Securities and Exchange Board of India (SEBI) has mandated KYC for mutual funds and broking accounts, the Insurance Regulatory Development Authority (IRDA) while buying insurance and the Forwards Markets and Commission (FMC) for commodity trading. You need to even submit it before making post office deposits.
Electronic KYC (e-KYC) is the process that enables a customer to open an account with the help of an Aadhaar card by just scanning the fingerprint of its client. Mobile enabled applications for verifying address by Geo tagging and Digital Signatures. With real-time approval or cancellation of the request makes life easier to the client and customers.
Being a dedicated firm registered as iCrederity Securities Services Pvt Ltd, for Know Your Customer (KYC) Process, iCrederity assists financial institutions to take conclusive decisions by establishing their customers credentials by conducting an In Person Verification (IPV) and thus pave the way for a seamless customer experience for the organization.
The KYC process also includes two types of checks which are essential for completing the cycle of proper identification of its customers. The first one being the identity check where the identity of the customer is verified and the second check is the address check that usually requires to be updated once an year for the individual customer.
Customers that apply for the KYC process in the category of identity check can either be a “Natural person (Individuals)” or a “Legal entity” such as private (Business entity or non- governmental organization) or public (Government organization). Identity of the customer under a Natural individual require any two documents i.e., Pan Card, Passport, Aadhar Card, Driving License and that of the legal entity require documents like Public/Private Limited-Certificate of Incorporation & AOA&MOA, Partnership Firm- Partnership deed along with identity proofs of each partner involved and Proprietorship Firm (Identity proof of the proprietor).
In the address check category, physical examination of both the permanent address and the present address should be updated for a natural person. For a Legal entity physical verification of the office address, present address and the permanent address of each Director/Partner/Proprietor should be recorded.