You receive a notification from your bank asking for updated personal information. At first, it might seem unnecessary. After all, you’ve already completed KYC when you opened your savings account. But here’s the thing: banks regularly need updated information to keep your account safe and compliant with regulations. This is where Re-KYC comes in.
What is re-KYC?
Source: axisbank.com
Re-KYC is the process by which banks periodically update their customers’ information to ensure it remains accurate and current. This helps banks comply with regulatory requirements and maintain secure customer records.
Why is re-KYC required?
Re-KYC keeps customer information up-to-date, comply with regulatory norms and reduce risks like fraud. The Reserve Bank of India (RBI) mandates periodic updates to maintain accurate records based on customer risk profiles.
How is re-KYC conducted?
The Re-KYC process involves updating customer information periodically. Banks categorise customers into groups based on their financial activities and profiles. This includes:
High-risk customers
These individuals typically have complex financial dealings or come from regions with higher risks. Due to the nature of their profiles, they need to update their re-KYC information every two years. Banks require high-risk customers to visit a branch in person to submit updated proof of identity and address for their savings account. This helps banks maintain stricter monitoring and control to prevent potential risks.
Medium-risk customers
Customers in this category have moderate levels of financial activity. They might include salaried employees with stable incomes but not enough complexity to be classified as high-risk. Banks ask medium-risk customers to update their information every eight years. They often have the option to visit a nearby branch, but the frequency of updates is less than that for high-risk clients, reflecting their moderate risk profile.
Low-risk customers
These customers generally have simple financial profiles, such as pensioners or individuals with long-standing accounts and stable sources of income. Low-risk customers are required to update their information every ten years. Banks often allow them to complete the process online via internet or mobile banking. This category’s lower monitoring frequency aligns with their reduced risk level
How to complete the re-KYC process?
Source: idfcfirstbank.com
To complete the re-KYC process for your savings account, follow these steps:
1. Receive notification and obtain the re-KYC form
Your bank will notify you when it is time to update your information. You can obtain the Re-KYC form from the bank, either online or at a branch. Fill out this form with your updated personal details, ensuring all information is accurate.
2. Prepare and submit documentation
You’ll need to provide valid proof of identity and address, such as a passport, Aadhaar card, PAN card or driving license. Make sure these documents are self-attested, meaning you sign and confirm them as true copies. If you’re a high-risk customer, you may be required to submit additional documentation and visit the bank in person.
3. Send the completed form and documents to the bank
Depending on your bank’s process, you can submit your Re-KYC documents for your savings account in person at a branch, by mail or digitally via internet or mobile banking. For low-risk customers, an online submission might be sufficient, but high-risk customers typically need to visit a branch.
4. Verification and confirmation
Once submitted, the bank will review your documents and verify the details. This can take a few days to complete. After verification, you’ll receive a confirmation from the bank that your Re-KYC is complete.
Endnote
Source: financialexpress.com
As you wrap up your Re-KYC, remember these key points. First, stay alert for notifications from your bank to avoid missing deadlines. Make sure you have the required documents, like your Aadhaar or PAN card, ready for self-attestation. If there are no changes to your information, take advantage of digital channels like online banking, email or SMS to update your details from home. Lastly, if any of your personal details have changed, reach out to your bank to ensure your information stays current. This will help keep your banking experience seamless and secure.
