The CKYC system is a centralized KYC system. SEBI has launched this new initiative. With uniform KYC norms and the inter-usability of KYC records across the sector, a Central KYC Registry is simply just that: a centralised collection of all your KYC records belonging to customers for use in the financial sector. The objective of such a collection is to reduce the burdens of making constant copies of your KYC information each time you need to apply for financial products or services. Financial institutions find it easier to obtain and produce these documents in order to verify them – with the user’s permission. s
We are opening multiple accounts with banks, insurance companies, mutual funds, etc., so a CKYC replaces KYC. In place of submitting KYC documents, such as pan card, Adhars, etc., as and when we open accounts, it suffices to register with CKYC OneC so you will get a KIN number so you can quote it whenever you open a new account, whether it is a bank account, mutual fund or insurance or the best fixed deposit scheme for senior citizen.
CERSAI (Central Registry of Securitization & Asset Reconstruction and Securities Interests in India) manages and administers the CKYC process. After completing the cKYC process with an entity like a bank, you can invest in all other financial products such as insurance, mutual funds, and Demat accounts.
A central KYC (CKYC) system stores all your (customer) information on one central server that all financial institutions can access. You will not need to repeat the CKYC process at any bank, mutual fund, or insurance company if you complete it at any bank, mutual fund, or insurance company.
Your 14-digit identification number will be provided to you once your cKYC form has been successfully processed. KINs (KYC Identification Numbers) are used for this purpose. Suppose you want to invest or purchase a financial product with another financial entity. In that case, you only need to quote this number when applying for a financial service or product like the best fixed deposit scheme for senior citizens.
What Is the Difference Between cKYC and eKYC?
The Aadhaar Number is used for electronic KYC, which is 100% paperless. The Aadhaar-based eKYC has a limit: investors can only invest a maximum of Rs 50,000 per year per fund house. Investors who wish to invest more must fill out a cKYC form, which requires self-attested proof of identity and residence, as well as a photograph. An Aadhaar card can be present as proof of identity and address.
Central Know Your Customer is an enterprise of the Government of India. The initiative is controlled via a set of uniform norms that ensure the inter-usability of these records across the financial sector; cKYC will act as a centralised KYC repository. The features of cKYC will include the following:
- The KYC Identification Number (KIN) or the CKYC number – a 14-digit number associated with an ID proof. A person can use this data to invest in mutual funds or to purchase any financial product.
- Data and documents related to KYC are stored in an electronic format that is digitally secured.
- An ID authentication with issuing authorities such as Aadhaar / PAN will be required.
- Every institution will be notified if their KYC details change.
In what ways does CKYC benefit you?
Your KYC documents do not have to be resubmitted unless your KYC details change. After you register your KYC details with CKYC, you will receive an identification number (KIN) that can be quoted for any type of financial transaction.
Which entities can use CKYC?
Customers can be registered under CKYC by financial institutions with RBI, SEBI, IRDAI, or PFRDA. In addition, any financial institution, such as a bank, a depository, an insurance provider, a mutual fund company, etc., will register your KYC with CKYC after acquiring any financial products from them.
Advantages For Financial Institutions
A Central Know Your Customer database, sometimes called Focal Know Your Customer, stores records of customers constantly looking for financial services. CERSAI (Central Registry of Securitization Asset Reconstruction and Security Interests) regulates this system.
cKYC makes verifying all documents much easier for anyone who constantly transacts with some financial institutions or even has multiple transactions with a single monetary organization.
A person doesn’t need to constantly upload their documents and verify their e-signature when applying for credit, carrying out a heavy transaction, or any other activity that requires them to verify their identity. A cKYC eliminates the process of constantly uploading different documents.