RBI eases KYC updation process to counter challenges faced by customers

Mumbai, 24 May 2025: The Reserve Bank of India has normalized the KYC updation process while amending the Master Direction of Know Your Customer (KYC) Direction 2016, dated February 25, 2016.

The Central Bank has observed a large pendency in periodic updation of KYC, including in the accounts opened for credit of Direct Benefit Transfer (DBT)/ Electronic Benefit Transfer (EBT) under Government schemes to facilitate credit of DBTs and/ or scholarship amount (DBT/ EBT/ scholarship beneficiaries) and accounts opened under PMJDY.

Meanwhile, it has been receiving complaints regarding challenges faced by the customers in the periodic updation of their KYC.

To enhance customer convenience, the RBI periodically updates KYC instructions.

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The processes of onboarding customers and updation/ periodic updation of KYC have been simplified, and the same are given below:

Face-to-face mode for onboarding the customer:

Customer may be onboarded in face-to-face mode through Aadhaarbiometric-based e-KYC authenticating and, in such case, if a customer wants to provide a current address, different from the address as per the identity information available in the UIDAI database (i.e., Central Identities Data Repository), he may give a self-declaration to that effect to the RE (ref.paragraph 16 of the Master Direction on KYC).

Further, the Digital KYC process is also allowed for customer onboarding.

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Non-face-to-face (NFTF) modes for onboarding the customer:

Consent-based onboarding of customers in NFTF mode may be done using Aadhaar OTP based e-KYC authentication, which is subject to certain conditions (ref. paragraph 17 of the Master Direction on KYC). Further, such account shall be placed under strict monitoring, and Customer Due Diligence (CDD) procedure shall be completed within a year.

Customer onboarding in NFTF mode using digital modes such as KYC Identifier, equivalent e-documents, documents issued through DigiLocker, and non-digital modes such as obtaining a copy of OVD certified by additional certifying authorities, as allowed for NRIs and PIOs, is subject to certain conditions (ref. paragraph 40 of the Master Direction on KYC).

Self-declarations – REs are allowed to obtain self-declaration regarding “no change in KYC information” or “a change only in address details” from customers using digital and non-digital modes, through customer’s email / mobile number registered with the RE, ATMs, digital channels (such as online banking/internet banking, mobile application of RE), letter, BCs, etc.

The periodic updating of KYC records is allowed to be carried out at any branch of the RE with which the customer maintains the account.

Aadhaar OTP-based e-KYC and V-CIP are permitted for updation/ periodic updating of KYC.

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