Don’t settle for ‘half’ when you can get ‘full’

3 MinsAug 17, 2020

The true convenience of digital banking is when you can take care of all your banking and financial needs from the comfort of your home. But the purpose is defeated if the first leg of the transaction, i.e. opening the account, requires you to visit a physical branch. 

Until recently, most banks offered e-KYC as a solution. However, that required a visit to the branch to avail the full suite of services. But now with banks offering full-fledged digital accounts, video-KYC is slowly becoming the norm. Let us understand the differences between the two.

kyc


What is KYC?

KYC is the process carried out by financial institutions to verify the identity of their customers, as per the rules defined by the Reserve Bank of India (RBI). It is done when you want to initiate any kind of banking transaction, such as opening an account, applying for a loan or credit card, etc. This process can be done mainly in two forms - half KYC (also known as e-KYC) and full KYC (now also done digitally via video, hence video-KYC). 

What is full-KYC?

  • Full-KYC requires physical verification of documents for identity and address proof, as prescribed by the RBI, such as driver’s license, passport, PAN card, etc. Click here to know more about the documents.
  • To complete full KYC, you can go ahead with or without Aadhaar. Choosing Aadhaar requires biometric authentication, while the non-Aadhaar method needs you to present your documents physically at the branch. 
  • Once full KYC is completed, you can access all the services offered by the bank for the particular account. 
  • Usually, to complete full-KYC you need to visit a branch or authorised KYC office, but in many cases, doorstep KYC verification can also be availed. However, given that the current situation calls for social distancing, branch visits as well as doorstep KYC poses additional risks that you may want to avoid. 

What is half KYC or e-KYC?

Also known as limited KYC or minimum KYC, this involves sharing fewer details which can mostly be done online (hence the name e-KYC). To attain this e-KYC or minimum-KYC status, all you need to do is voluntarily provide some identification details such as your Aadhaar number, or your PAN number. It also requires OTP-based verification of valid identification documents.

There are benefits as well as restrictions to this procedure. 

Benefits:

For starters, this allows you to start using your bank account instantly, pay for bills or make purchases online etc. You may even be able to make purchases online via a virtual card which is issued immediately after account creation.

Restrictions: 

  • However, the maximum balance of an e-KYC account usually cannot exceed ₹1,00,000. Additionally, you cannot add more than ₹2,00,000 in a financial year to such a minimum KYC bank account.
  • A minimum KYC bank account can be used for a year, after which Full KYC needs to be completed to continue using it. 
  • There could be funding restrictions via cash or cheque also no chequebooks are issued. 

What is video-KYC?

Starting January 2020, RBI has added the option of conducting video-KYC for opening accounts. This type of KYC is considered equivalent to full-KYC. Not only does this make things convenient in the current situation, but it also aligns account-opening better with the new-age digital banking experience. With video-KYC, as long as you have reliable internet connectivity and an internet-connected laptop or smartphone, with access to a camera, you should be able to make the most of it.

The video-KYC needs to be conducted over a live video feed, where a live photograph of the customer and clear images of the documents to be verified are captured. Other measures include OTP-based verification of Aadhaar. This does away the need for submitting any physical documents. There are several other requirements detailed that need to be followed as well.

An end-to-end digital experience

The biggest benefit of video-KYC is the comfort of completing the account opening process from your home. Additionally, you get an account that has all banking features enabled from the time of account opening and ready to be used as soon as the account is activated. You can open your account anywhere, anytime and start your transactions almost immediately, without any documentation. There are no restrictions on the account balance or access to services such as cheque book, etc.

Axis Bank’s Full Power Digital Savings Accounts – Easy Access Full Power Digital Account and Prime Full Power Digital Account, can be opened in four simple steps, thanks to video-KYC. These accounts bring more banking services to you faster than ever before - making your entire banking experience Dil se Digital.

[Also Read: Taking the first step into Digital Banking]

Disclaimer: This article has been authored by Siddharth Parwatay, a Mumbai based independent tech-journalist, editor, and content-creator. Axis Bank doesn't influence the views of the author in any way. Axis Bank and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.