Video KYC

Gone are the days of waiting in long queues for a simple account opening. Thanks to advancements in technology, video KYC (Know Your Customer) has emerged as a safe and convenient way to complete your KYC verification. But how exactly does it work, and what are its advantages?

What is Video KYC?

Video KYC (VKYC) serves as a digital counterpart to the traditional in-person Know Your Customer process, conducted through a live video call. This method stands out for being cost-effective, secure, and swift, delivering real-time results.

In 2020, as the world faced the COVID-19 crisis, businesses across industries grappled with balancing security and seamless customer onboarding. Traditional, manual verification posed several challenges, including complexity, lengthy turnaround times, and high operational costs. These issues prompted organizations to embrace digital onboarding and adopt video KYC. This shift allowed them to simplify verifications at scale, reduce operational expenses, and facilitate contactless customer onboarding.

Video KYC is completely digital – Schedule a quick video call, hold up your ID for a virtual check, and that’s it! No more waiting in lines – video KYC can be done in minutes, on your schedule.

Security is a top priority. Video KYC platforms use high-tech video conferencing and data encryption to keep your information safe.

Unlike some digital verification methods, Video KYC is the full package. It grants you full access to financial products and services, unlike limited KYC options that restrict features. And, the process itself is a breeze. It typically takes between 2 and 10 minutes for you, with a little extra time for the specialist to double-check everything. To be prepared, just have your Aadhaar card, PAN card, another ID (like Voter ID or Driver’s License), and a pen for a quick signature ready.

Steps Involved in Video KYC

1. Registration and Initial Setup

Visit the official website of the bank or NBFC.
Fill out the required details in the online form.
Provide consent for the lender to fetch your Aadhaar details or conduct an e-PAN verification process.
Provide access to your phone’s location for geo-tagging purposes.

2. Document Upload and Verification

Upload officially valid documents. These can be images on your phone, PDF files, or documents stored in the government’s DigiLocker facility. Details from these documents will be used to fill in the application form.
An OTP will be sent to your registered mobile number, requesting you to verify the details in the form before sharing the OTP.
Once you validate the OTP, it is considered your customer signature on the application form.

3. Initiation of Video Call

The bank will send an SMS to your registered mobile number with a link to the webpage hosted by the bank for the video call. Some banks may direct you to the video call webpage automatically from their website.
A trained official or KYC expert initiates the video call for face-to-face interaction.

4. Video Call and Liveness Check

During the call, the KYC expert conducts a liveness detection check to ensure the customer is physically present.
The KYC expert requests an identity document—typically an Aadhaar card, PAN card, driving license, or another government-issued document—and validates the identity in real-time using facial recognition technology. The expert ensures that the photo on the document matches the customer’s face in the video call.
The document is checked for signs of forgery or tampering.

5. Additional Verifications

The expert verifies the customer’s real-time location using geo-tagging software.
A live photograph is captured during the video call and cross-checked with the photograph uploaded earlier. Some banks may use facial recognition technology for this confirmation.
The customer may be required to display some documents on the video call, from which the required details will be captured by the software.
The customer will be asked random questions based on the documents provided.

6. Completion and Record Keeping

Once the call is complete, the officer makes a recommendation for approval or rejection of the application. If verification is successful, the application form will be digitally signed by the authorized officer.
The verification results are delivered, and the video call is recorded and stored for future reference.

Advantages of Video KYC

There are several benefits to opting for video KYC:

Convenience: No more waiting in queues! You can complete your KYC from the comfort of your home at your preferred time.
Speed: Video KYC is a much faster process compared to traditional methods. The verification can be done within minutes.
Paperless: The entire process is digital, eliminating the need for physical paperwork. This is eco-friendly and saves time.
Secure: Video KYC platforms use secure video conferencing technologies and data encryption to protect your personal information.

How Video KYC is Changing Identity Verification

Video KYC isn’t just about opening accounts from your couch (although that’s a pretty cool perk). This powerful tool is transforming how businesses verify identities across various industries.

Streamlined Account Opening: Forget mountains of paperwork! Financial institutions and fintech companies can leverage video KYC to remotely verify customer identities during account opening. This speeds up the onboarding process, keeping happy customers and ensuring compliance with KYC and AML regulations.
Beyond Banking: Video KYC goes beyond finance. With the rise of online scams, it provides a secure and reliable way to verify identities for various online services. E-commerce platforms, gaming companies, and anyone requiring user verification can benefit from this robust solution.
Staying Compliant: Regulations like KYC, AML, and GDPR can feel overwhelming. Video KYC simplifies compliance monitoring for businesses by helping them verify identities and ensure they’re meeting these crucial standards. This reduces the risk of hefty fines and reputational damage.
Faster Insurance Claims: Video KYC can streamline the insurance claims process. Insurance companies can verify policyholder and beneficiary identities during claims, preventing fraudulent claims and ensuring payouts reach the right people. Live video verification also ensures adherence to regulations before processing bills and claims.
Secure Telemedicine: The rise of telemedicine demands secure ways to verify patients. Video KYC allows healthcare providers to verify patient identities before virtual consultations, ensuring healthcare services go to the right individuals and reducing the risk of medical identity theft.
Verified Rentals and Property Sales: Real estate agents and property managers can leverage video KYC to verify the identities of tenants and landlords during the rental or sale process. This helps prevent fraud and ensures leases and purchase agreements are signed by the authorized parties.

In conclusion, video KYC is revolutionizing the way we approach identity verification, making it faster, more convenient, and secure. This technology not only enhances customer experiences by eliminating the need for physical visits but also provides robust security measures to protect personal data. Industries ranging from banking and finance to healthcare and real estate are benefiting from streamlined onboarding processes and improved compliance with regulations.

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Common FAQs in Video KYC

What are the RBI guidelines for Video KYC?

Customer consent must be confirmed before the Video-based Customer Identification Process (V-CIP).
The customer’s live photo should be geo-tagged to confirm they are in India.
The video KYC application must be developed by the regulated entities and used only at specific customer touchpoints; third-party video platforms are not allowed.
The video process must be initiated from the lender’s domain and stored securely.
Access to the application should be through live OTP, time-based OTP, or login ID and password.
Documents for verification can be captured by video or uploaded.
Only banks can use OTP-based Aadhaar e-KYC or offline Aadhaar verification.
Non-banking entities can use only offline Aadhaar verification.
Customers not using Aadhaar must provide other officially valid documents.
Documents uploaded to the DigiLocker platform can also be used.

Can we do video KYC in Mobile?

Yes, Video KYC can be conducted on mobile devices. Most banks and financial institutions provide mobile applications or mobile-optimized websites to facilitate the Video KYC process. Customers can complete their KYC verification using their smartphone cameras and an internet connection.

What if video KYC is not done?

If Video KYC is not completed, the customer may face limitations on their account. These limitations could include:

Restricted access to certain banking services.
Inability to upgrade the account from minimum KYC to full KYC status.
Potential suspension of the account if full KYC compliance is not achieved within the stipulated period.

What are the important guidelines for Video-KYC?

Background should be white and no one else should be visible in the frame.
Providing access to the mobile device’s camera and location services.
Display documents vertically from above during live capture.
Verify that the video process link directs to the bank’s domain website.
Request the officer to display their identity card and note down their name and employee ID for authenticity.

What are the documents required for Video-KYC?

The documents required for Video-KYC (V-KYC) can vary depending on the institution and region, but typically the minimum requirement is:

Original PAN Card: This is the most important document for V-KYC. Some institutions may accept other government issued ID cards, but a PAN Card is widely accepted. Make sure it’s the original PAN Card and not a soft copy.

In addition to the PAN Card, some institutions may also require:

Aadhaar Card: This is another commonly requested document for V-KYC, especially in India [Bank of Baroda, Open online Savings Account using Video KYC (V-KYC)].

Address Proof: While not always required, some institutions may ask for a document as proof of your current address. This could be a utility bill, bank statement, or other government issued document showing your address.

In addition to these, the representative may also ask you to sign a document during the video call and then hold it up to the camera.

What happens if the video-KYC is interrupted due to internet connectivity or other issues?