Simplified KYC Compliance for Regulated Entities under RBI’s KYC Direction

The Reserve Bank of India (“RBI”) vide its notification dated 12^th June 2025 titled “Updation/ Periodic Updation of KYC – Revised Instructions”, has amended the Master Direction – Know Your Customer (KYC) Direction, 2016 (“KYC Direction”) to simplify the KYC procedure. In doing so, RBI has provided that:

1. CKYCR - While onboarding customer, the Regulated Entities (“REs”) shall at first download customers’ KYC records online from Central KYC Records Registry (“CKYCR”) with customer’s consent without requiring him/ her to submit the same records again, unless there is a change in records available with CKYCR.
2. Face-to-face mode for onboarding the customer - Customer may be onboarded in face-to-face mode through Aadhaar biometric based e-KYC authenticating and, in such case, if customer wants to provide a current address, different from the address as per the identity information available in the UIDAI database, he may give a self-declaration to that effect to the regulated entities. Further, Digital KYC process is also allowed for customer onboarding.
3. Non-Face-to-Face (“NFTF”) Onboarding - Customers may be onboarded remotely using the following methods:
   • Aadhaar OTP-based e-KYC authentication, provided certain conditions such as placing the account under strict monitoring, and completion of Customer Due Diligence (“CDD”) procedure within a year are complied with.
   • Other accepted NFTF modes include: Use of KYC Identifier, equivalent e-documents, documents issued through DigiLocker, OVD copies certified by authorised bodies for NRIs and PIOs, subject to compliance with the requisites under the KYC Directions.
4. Video-Based Customer Identification Process (“V-CIP”): The V-CIP is digital alternative to in-person verification. This method involves a live, secure, and consent-based audiovisual interaction conducted by an authorised official of the regulated entity. Importantly, V-CIP is treated at par with face-to-face onboarding, providing REs a regulatory-compliant, user-friendly, and efficient method of customer verification.

5. Eased KYC Updation and Periodic Review Requirements: Simplified methods for KYC updation are as outlined below:

   • Self-declaration for no change or change in address may be submitted through:

     1. Registered email or mobile number,

     2.  ATMs, digital banking channels, letters, or Business Correspondents (“BCs”).

   • Aadhaar OTP-based e-KYC and V-CIP can be used for KYC updation as well.

   • KYC can be updated at any branch of the RE where the customer holds an account.

   • Regulated entities must update KYC information based on notifications received from CKYCR, ensuring records remain accurate and current.