I am sure you would know about the KYC, if you are first time investor and wanted to invest in mutual fund or want to open saving account in a bank, you need to go through with KYC process.
It is a process under which a financial institution or an intermediary collects certain data and documents to establish the identity of a client.You have to register for multiple KYC for the different financial products.
Too much paperwork, right?
To reduce this tedious KYC process, the government has taken initiative to setup CERSAI (Central Registry of Securitization Asset Reconstruction and Security Interest of India) Government authorized body to function as the central KYC Registry (CKYCR).
The objective of CKYCR is to reduce the burden of producing KYC documents and getting those verified every time when the investor deals with a financial entity for the first time. From 1st Feb 2017, new investors in a mutual fund will have to do cKYC (Central Know Your Customer), before investing. cKYC will replace the earlier KYC (Know your customer) procedure.
*As of now, existing investors in mutual funds, who are KYC compliant can continue investing in mutual funds. So, there is no need to apply for cKYC.
Now we will try to know that what is cKYC and how we can apply for the cKYC process.
cKYC is the process to collect the standardized documents for the customer that will be managed by administrative registry i.e. CERSAI.This entity is responsible for keeping the data records for each KYC that is processed. This centralized registry ensures that norms for KYC are standardized across the financial sector in India.
It also ensures that inter-usability of KYC records and data making sure that the consumer does not have to do KYC each time when opening a financial relationship with the institution.
To be cKYC compliant you need to fill the Central KYC(cKYC) form. Along with the correctly filled form, the customer has to submit a self-attested copy of proof of identity (PAN card, etc) and proof of address, along with this a scanned photo & signature also needs to be submitted.
There are some new fields in the cKYC form such as the name of the applicant’s mother which was not there in earlier KYC forms. After opening a KYC account or completing cKYC, you will get a 14-digit KYC identification number (KIN) which is unique to every individual.
So, you just have to show this number every time for a new investment or opening a new account in any financial entity. The number will have centrally stored data which can be assessed by any financial entity and will save you and bank or mutual fund AMC etc. for KYC process all over again.
DOCUMENTS REQUIRED WITH cKYC FORM
One needs to submit following set of documents while submitting a Central KYC form:
- Correctly filled and signed cKYC form
- A self-attested copy of Proof of Identity
- A self-attested copy of Proof of Residence
- One photograph
How to check cKYC application status online?
Once you submit your cKYC form with all the required documents to a financial institution, they will upload your records with central cKYC platform.If all documents and details are in place, your form will be processed and 14-digit KIN No. will be issued to you.
This process may generally take a 3-5 business day. Karvy has recently launched a KYC and cKYC status checking platform, you can now verify your status from Karvy platform, even you will be able to get the details of your cKYC id.