KYC stands for Know Your Customer (or Client). It is a process by which financial institutions and regulated entities verify and record the identity, address, and other essential information of their customers/clients. In India, it is mandated under various regulations (for example under the Securities and Exchange Board of India (SEBI) via the KRA regulations, and under the Prevention of Money Laundering Act, 2002 and associated rules for anti-money laundering (AML) / counter-terror financing (CTF) purposes) for banks, mutual funds, brokers, etc.
Why it’s important:
1. It helps prevent misuse of financial services for illegal activities (money-laundering, financing terrorism, fraud).
2. It gives a standardized way for financial intermediaries to onboard clients and monitor them.
3. It helps investors/clients by reducing duplication: once you complete your KYC with one intermediary and register with a KRA, many other intermediaries can reuse the record rather than asking you to submit
everything again.
4. It also helps regulatory oversight and maintenance of a central repository (via the central KYC registry) so that the client’s credentials are tracked uniformly.
In short: doing KYC is a one-time compliance step (for most cases) which enables you to transact in securities, mutual funds, and various regulated intermediaries without repeating full paperwork each time.
In the securities markets in India, a set of entities called KYC Registration Agencies (KRAs) have been registered by SEBI to maintain KYC records of clients, upload & store them, enable access by intermediaries, etc.
There are five KRAs registered with SEBI, which are:
1. CDSL Ventures Limited (CVL-KRA)
2. NSDL Database Management Limited (NDML-KRA)
3. Karvy Data Management Services Ltd (Karvy-KRA)
4. CAMS Investor Services Pvt Ltd (CAMS-KRA)
5. NSE Data & Analytics Limited (formerly DotEx KRA)
Each KRA:
1. Receives KYC forms & documents from intermediaries (brokers, mutual funds, etc.) for clients.
2. Validates and stores the KYC information (physical + electronic) and makes it accessible to other intermediaries
3. Helps avoid duplication of KYC processes across intermediaries.
4. They are now also required to upload verified KYC information on the central KYC records registry (CKYCR) managed by Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI) for broader financial-sector use.
Below is the general physical / offline KYC process for a KRA (for individual clients). The exact forms may vary slightly among KRAs, but they follow the same regulatory framework.
1. “KRA – Individual KYC Application Form” (for individuals) – download from the respective KRA’s website.
2. “KRA – Non-Individual KYC Application Form” (for non-individual entities such as companies/trusts) – when applicable.
3. (If modifying existing KYC) “KRA KYC Change/Modification Form” – for updating details such as address, name change, etc.
Typically, you will have to attach self-attested copies of:
1. Proof of Identity (PoI): e.g., valid PAN card, Aadhaar card, passport, voter ID, driver’s license.
2. Proof of Address (PoA): e.g., Aadhaar (if address same), utility bills, bank statements, driving license, etc.
3. Recent passport-size photograph of the applicant. (Some forms require a photo affixed)
4. In the case of minors: the guardian’s documents plus the minor’s birth certificate if required.
5. If a non-individual entity: registration/incorporation certificate, list of directors, PAN of entity, etc.
1. Download the KRA application form (Individual/Non-Individual) from the relevant KRA website or obtain it from the intermediary.
2. Fill out the form completely and sign it. Ensure you fill in your PAN, date of birth, address, contact details, email, mobile number.
3. Attach self-attested copies of the required identity and address proofs plus a photo.
4. Submit the form along with documents to the intermediary/broker/mutual fund or directly to the KRA (as per intermediary instruction). Some intermediaries may forward the documents to the KRA on your behalf.
5. The intermediary conducts In-Person Verification (IPV): the physical presence of the client to verify the original documents may be required. Once done, the intermediary forwards/ uploads the documents to the KRA.
6. The KRA processes the application, validates details (PAN correctness, address proof validity etc.) and assigns status (e.g., “KYC Registered”, “KYC Validated”, “KYC On-Hold/Rejected”).
7. Once validated, the KRA notifies you (via email or SMS) confirming your KYC registration is completed.
Most KRAs and intermediaries now provide a way to do the KYC (or update it) online / digital. Here’s the typical step-by-step online process that applies (with minor variations) to different KRAs.
1. Visit the website of the relevant KRA (or the intermediary KYC portal which links to KRA). For example, to check KYC status you can visit the “KYC Inquiry” portal of CVL-KRA.
2. Enter your PAN number (as the main identifier) and captcha. The system displays your existing KYC status and the KRA where your KYC is registered.
3. If doing fresh KYC/ updation: you may be asked to fill in an online application form with your details (name, DOB, address, email, mobile) and upload scanned/self-attested copies of identity proof, address proof, photo. Some systems also allow Aadhaar-based eKYC or Digi Locker to fetch.
4. Mobile number and email ID verification via OTP is typically required. The system sends OTPs to your mobile and/or email; you enter them to verify.
5. In some cases, biometric or video-based verification (Video-CIP) might be required (especially for “non-face-to-face” onboarding). Recent regulatory updates by the Reserve Bank of India also support this.
6. Once all data and documents are uploaded and verified, the KRA updates your KYC record, sets status to “Validated” and notifies you via SMS/email.
You can check your status anytime via the “KYC Inquiry” feature of the KRA website.
1. If you already have Aadhaar and your mobile number is Aadhaar-linked, the process is faster because many details can be pre-filled/eKYC.
2. For minors/NRIs, special additional documents may be required (for NRIs — passport, OCI/PIO card, foreign address proof) in addition to the standard ones.
3. Online KYC is especially useful since you don’t have to physically visit the intermediary or physically submit documents in many cases; scanning/uploading suffices.
1. Once you complete your KYC with any SEBI-registered intermediary and the KRA, you generally do not need to repeat full KYC for every other intermediary (given in the inter-operability of KRA records).
2. Regularly check your KYC status (via PAN at the relevant KRA website) to ensure it is VALIDATED. If it shows “On-Hold” or “Rejected”, you must remedy the deficiencies (e.g., update mobile/email or submit missing documents).
3. The KRA record is increasingly being integrated into the central KYC registry (CKYCR) so that other financial segments (banks, insurance, etc.) may use the one KYC rather than many.
4. Minor changes may now require simpler update processes and fewer documents (depending on the regulator’s current rules) — always check the intermediary’s instructions.
5. Make sure that your PAN, Aadhaar, address, mobile number and email are all up to date and consistent — mismatches are a common cause for KYC “On-Hold”.
6. For non-individual clients (companies, trusts, partnerships) the process is more detailed: entity incorporation details, list of directors, authorized signatories, etc.