KYC – I am sure that you would have heard about it before. KYC stands for Know your Customer. It is a process under which a financial institution or an intermediary collects certain data and documents to establish identity of a client.
You would have noticed that when you visit a bank for opening a Savings account, your banker would have asked you to complete a KYC form. You would have also submitted KYC form to invest in mutual funds.
So, to open a bank account, the bank would do a KYC, for buying an insurance policy the insurer would do it and a mutual fund would again do it, if you invest in Mutual Fund schemes.
You have to be KYC compliant with multiple financial institutions or agencies for different financial and investment products. Too much paper work, right? Is there any single and common KYC?
To end this tedious work, the Govt had introduced cKYC (Central KYC) from July 2015. This means that a single KYC will suffice to invest in all financial products, including mutual funds.
And from 1st Feb 2017, new investors in mutual fund will have to do cKYC (Central Know Your Customer), before investing . cKYC will replace the earlier KYC (Know your customer) procedure.
If you are any existing mutual fund investor, do you need to do anything?
As of now, existing investors in mutual funds who are KYC compliant can continue investing in mutual funds. No updation is required from your end. So, there is no need to apply for cKYC.
What is cKYC?
Central KYC is a process of storing the KYC details of the customer centrally. cKYC is being managed and administered by the Central Registry of Securitization & Asset Reconstruction and Securities Interest in India (CERSAI).
If you complete the cKYC process with an entity say a bank, it is sufficient for you to invest in all other financial products like insurance, mutual funds, Demat account etc., .
Central KYC (cKYC) will store all the your (customer) information at one central server that is accessible to all the financial institutions. So completing cKYC process with any bank, Mutual Fund, or an insurance company is enough and you won’t have to do this process again anywhere.
Once your cKYC form is processed successfully, you will receive a 14-digit identification number. This is known as KIN (KYC Identification Number). You need to just quote this number at the time of a new investment or purchasing a financial product with any other financial entity.
(Kindly note that getting cKYC compliant is free of cost for customers / investors.)
How to get Central KYC done?
If you are a first time mutual fund investor or planning to open a Savings Bank account or a Demat account, you need to submit below new cKYC form to your financial institution.
In case of mutual fund investments, you can also submit this new KYC form to your mutual fund distributor, or at mutual fund AMC office or any Registrar (like CAMS).
Download cKYC Form.
You will have to submit a duly filled & signed cKYC form along with self attested supporting documents to verify proof of identity and proof of address. Copies of Passport, Aadhar card, Voter ID, Driving license etc., are accepted as supporting documents.
(Kindly note that new cKYC form also captures FATCA compliance details)
How to check cKYC application status online?
Once you submit your cKYC form to financial institution (reporting entity), they will upload your records on centraly KYC platform (within 3 days).
If all details and documents are in place, your form will be processed and KIN (14 digit number) will be issued to you. An SMS or email will be sent to you. This process may generally take 3 to 5 working days.
As of now, one can not check the application status of cKYC online. In case, your cKYC is not processed or rejected, you may have to follow it up with your financial institution or distributor entity only.
Latest Update (17-April-2017) :
The R&T Agent, Karvy has now launched an online KYC & cKYC status checking platform. You can now verify your c-KYC application status online. You can even get to know your cKYC ID also.
- Kindly visit Karvy’s KYC Search portal
- I have tried checking my KYC status based on my PAN. As I have not yet applied for cKYC, the status is blank and normal KYC details are shown as below;
Change of Details & cKYC?
Let’s say there is a change in your communication address and would like to update it in your banking account. You can submit cKYC form by selecting ‘update KYC number’ option in the form and can provide latest details.
Once the KYC details are updated by any reporting entity (like your bank), all other institutions can get a real time update on the same.
Mutual Funds & cKYC Updation Form
For FAQs on cKYC, kindly click on below image.
(Image courtesy of Stuart Miles at FreeDigitalPhotos.net)
(Post first published on : 03-March-2017)