Menu
Close
EmailContact
LoginLogin
Blog Overview Video KYC 6 reasons why you should use V-CIP for re-KYC

6 reasons why you should use V-CIP for re-KYC

6 reasons why you should use V-CIP for re-KYC

On 9th January 2020,  The Ministry of Finance with a  view to leverage digital channels amended the Master Direction on KYC to allow Banks & regulated entities, various methods to collect a customer’s information electronically.  Under the digital KYC norms, RBI  mandates a video call between the institute and the consumer to establish what is termed as V-CIP (video-based customer identification procedure) for the KYC.

While KYC details are updated when a customer opens an account, as per RBI guidelines, financial institutions should request a Re-KYC at regular intervals to keep their records up-to-date. That is, every 10 years for low-risk customers, every 8 years for medium-risk customers and every 2 years for high-risk customers if there is no change in identity or address.

The reach of V-CIP for Re-KYC was earlier restricted to low-risk customers. Banks havent’ been too keen on easing the re-KYC process, even for their low-risk customers as the still rely on the traditional, physical KYC updation. However, on 5th May 2021, the RBI released a new circular which has put the onus again on banks to adopt V-CIP for periodic KYC updation of their customers.

While we await further details from the RBI to gain more actionable clarity, we’ve rounded up the top 6 benefits of using V-CIP for re-KYC for you:

#1 Best-in-class experience for your best customers

Let your low-risk customers complete their Re-KYC from the comfort of their homes or even a remote location using V-CIP. V-CIP is an easy procedure with just a few steps compared to the traditional KYC process. This is what makes it a smooth experience for customers.

#2 No more queues for Life Certificate submissions

Avoid the queuing of government pensioners at your branches for Life Certificate submissions. Give them the option to submit it over a video call and increase your operational efficiency.

#3 Let senior citizens take it easy

Senior citizens form a significant chunk of your low-risk customers. Allow them to complete their KYC updation from the comfort of their homes without the hassle of physical branch visits.   

#4 Proactive fraud prevention 

Traditional-KYC is vulnerable to fraud, with many examples of customers using fake or appropriated identities to avail financial services like loans. With V-CIP, the financial institution has complete control over the verification process, from start to end. This eliminates the misuse of pension funds by fraudsters using Jeevan Pramaan/ Digital Life Certificate.

#5 No More Chasing Rural Customers 

A lot of rural customers open accounts just for claiming government subsidies . It is very expensive & operationally challenging to follow up with these clients  manually, However, V-CIP allows a  low-cost and effective process to reach out to these dormant account holders over a simple video call.  

#6  Champion the distanced world

With restrictions on physical interactions due to the pandemic, V-CIP ensures the safety of customers and employees by enabling virtual face-to-face interactions.

Therefore, it is clear that V-CIP is ushering in a new system of KYC authentication that is quicker, more reliable, and more seamless for financial institutions and customers alike. 

Please email us on shivani@idfy.com to know how IDfy’s video KYC platform can help you digitise your re-KYC process.

Follow us on your preferred social media channels for regular updates.

IDfy Youtube Channel   IDfy LinkedIn Profile   IDfy Facebook Profile

Share Now
customer_re-KYC_V-CIP