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In a 1st, RBI introduced video-based identification process for KYC

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On January 10, 2020 the Reserve Bank of India(RBI) for the 1st time has introduced Aadhaar-based Video Customer Identification Process (V-CIP). This process will allow banks and other lenders to complete the KYC (Know Your Customer) process of customers on video itself. This facility can be used as an alternative to the already available e-KYC facility. To introduce V-CIP, RBI has amended guidelines under the Prevention of Money-laundering (Maintenance of Records) Rules, 2005.Video Customer Identification Process (V-CIP):

i.Consent-based V-CIP: The video KYC will be consent based i.e, banks can complete V-CIP of KYC process only after obtaining consent from the bank customers. This is done to adhere to the RBI’s KYC norms by leveraging digital technology.

  • It should also be ensured by the Regulating entities(REs) that video recording is stored in a safe and secure manner and bears the date and time stamp.

ii.Digital KYC redefined: The definition of digital KYC has been changed in section 3 of the Master Direction on KYC dated February 25, 2016.

iii.New definition of Digital KYC: Capturing live photo of the customer and officially valid document or the proof of possession of Aadhaar, where offline verification cannot be carried out, along with the latitude and longitude of the location where such live photo is being taken by an authorised officer of the Reporting Entity (RE) as per the provisions contained in the Act.

iv.New features: The REs will now be able to record video as well as capture photograph of the customer present for identification and obtain the identification information. The identification information is as follows:

  • OTP based Aadhaar e-KYC authentication or Offline Verification of Aadhaar for identification.
  • Services of Business Correspondents (BCs) may be used by banks for aiding the V-CIP.

v.RE Duties: some of the duties of the RE are as follows:

  • The RE should capture a clear image of PAN (Permanent Account Number) card to be displayed by the customer during the process, except in cases where e-PAN is provided by the customer.
  • Live location of the customer (Geotagging) will be captured to ensure customer’s physical presence in India for the V-CIP process.
  • Information like photograph of the customer in the Aadhaar/PAN details matches with the customer undertaking the V-CIP.
  • REs other than banks can only carry out offline verification of Aadhaar for identification.

About RBI
Establishment- 1 April 1935, Kolkata
Headquarters- Mumbai, Maharashtra
Governor- Shaktikanta Das
Deputy Governors- 4 (BP Kanungo, NS Vishwanathan, Mahesh Kumar Jain & 4th is yet to be appointed)