RBI Revises KYC Updation Guidelines to Improve Convenience and Inclusion
The Reserve Bank of India (RBI) has announced revised instructions to streamline the process of updation and periodic updation of Know Your Customer (KYC) details for bank customers. These changes are part of a broader effort to enhance customer convenience, reduce account inoperability, and support inclusive banking, particularly in rural and underserved regions.
According to the revised guidelines, significant pendency has been observed in periodic KYC updation, especially for accounts used for Direct Benefit Transfer (DBT), Electronic Benefit Transfer (EBT), scholarships, and those opened under the Pradhan Mantri Jan Dhan Yojana (PMJDY). To address this, the RBI has introduced amendments via the Know Your Customer (KYC) (Amendment) Directions, 2025, and related circulars on inoperative accounts and unclaimed deposits.
A key highlight of the update is the authorization of Business Correspondents (BCs) to assist customers with the KYC updation process. This measure is particularly valuable in rural and semi-urban areas where digital or physical access to bank branches can be limited.
Banks have also been directed to organize intensive KYC updation campaigns and special camps in areas with high pendency. Emphasis is placed on adopting an empathetic approach when dealing with customers whose accounts have become inoperative due to incomplete KYC.
In addition, RBI reiterated the simplified customer onboarding and KYC processes introduced over the years. These include:
- Face-to-face onboarding using Aadhaar biometric-based e-KYC or digital KYC methods.
- Non-face-to-face (NFTF) onboarding through Aadhaar OTP-based e-KYC, use of DigiLocker documents, and certified copies of Officially Valid Documents (OVDs) for NRIs and PIOs.
- Video-based Customer Identification Process (V-CIP), which is considered equivalent to face-to-face verification.
For periodic KYC updation, customers may submit self-declarations through various digital and non-digital modes, including email, mobile banking, ATMs, physical letters, or via BCs. Banks can update KYC at any branch and may use Aadhaar OTP or V-CIP for this purpose. Further, banks must update KYC records based on notifications received from the Central KYC Registry (CKYCR).
These measures underline RBI’s continued commitment to balancing regulatory requirements with user-friendly approaches, enabling greater financial inclusion and ensuring smoother access to banking services for all segments of society.
