Knowing your customer is the best process to avoid any fraudulent activity. Every non-banking financial institution and banking financial institution goes through the process of KYC to perform the identity verification of the customers. Along with that, the process of KYChelps to review the clients’ financial activities while assessing the risk factor attached to it. KYC system helps to avoid terrorism financing while keeping the money laundering.
It keeps any illicit financial activities at bay. However, the ultimate aim of going through the process of KYC Process is to confirm while having the highest level of assurance about the customer; who they are. Primarily for every financial institution, the process of KYC is a mandatory one. But for other business organizations, it is not mandated, but one can voluntarily implement the process of KYC. It is a healthy sign that the business is a trustworthy one. It also signals that the business takes care of the protection of the customer.
List of documents required for KYC
One requires a certain list of documents to go through the process of KYC verification. These documents can help you to go through the verification of the KYC without any hiccups. For example, when an individual is trying to invest for the first time in any mutual funds, they need to undergo the process of KYC verification. It would take a day or so to complete the process. If you can ensure the various documents before the verification, it would be easier for you to go through the process. For completing the verification procedure, one needs to submit the documents mentioned below.
KYC needed for identity proof
To undergo the process of KYC verification, one needs to have two broad sets of documents. The documents required for the address proof and the identity proof can sometimes overlap, but they vary from one another in most cases. The list of KYC documentation required is:
- The unique identification number or UID that comes along with an Aadhar card. An individual can also use a passport or voter ID in this case.
- PAN Card along with the photograph
- Essential documents or identity card that comes with the applicant’s photo. One must understand that these documents should be issued by the central government, state government, or other statutory or regulatory bodies.
- An identification card that the scheduled commercial bank, public financial institutions, and private sector undertakings issues
- Identity cards that one can get from colleges or universities that are affiliated. Also, the documents for identification are provided by any professional bodies, including ICAI, ICWAI, ICSI, bar council, and many more.
- A debit card or credit card issued by various banking financial institutions comes with the individual’s address, and the name is one of the valid KYC documents.
KYC needed for address proof
- The registered sale agreement, driving license, flat maintenance bill, voter ID card, insurance copy
- Self-declaration provided by the high court or Supreme Court judge provides the new address to the applicant if the applicant gets convicted.
- Utility bills include gas bills or electricity bills, water consumption bills, telephone bills. But remember that these bills should not exceed three months.
- Identification card along with the address. It can be any identification card of colleges or universities or any professional bodies like the Bar Council of ICAI.
- Address proof in the spouse’s name is another valid KYC document.
Various types of KYC verification
One can carry out the process of KYC verification in both online eKYC and offline mode. In the case of online mode, one needs to upload scanned copies of various documents to complete the process. But in the case of offline mode, the customer needs to visit the institution physically to get the process started. But in both cases, this KYC documentation can help to complete the process faster.