What is CKYC ? How does CKYC work?

Central Know Your Customer (CKYC) is a system implemented by the Indian Ministry of Finance to streamline KYC verification procedures for financial institutions. It establishes a centralized repository managed by the Central Registry of Securitization Asset Reconstruction and Security Interest of India (CERSAI). This database houses the KYC information of individuals who have undergone the CKYC process. It streamlines customer verification for all financial sector participant like banks, mutual funds, insurance companies, and many more by replacing repetitive KYC paperwork with a one-time, centralized process. CKYC as a secure digital vault that stores the KYC details of a person after they complete the process with a participating financial institution. This eliminates the need to go through the entire KYC hassle again when dealing with other institutions. CKYC assigns a unique identification number to a customer that acts as their KYC passport across various financial service providers in India. No more piles of paperwork or repeated verifications-just a smooth and efficient onboarding experience. CKYC operates through a collaborative effort between individuals, KYC Registration Agencies (KRAs), financial institutions, and CERSAI. The process: For Individuals: CKYC Registration: Individuals initiate the CKYC process by approaching a KRA or a participating financial institution. The KRA or institution collects the required KYC documents (PAN card, address proof, etc.) and begins the verification process. This can be an in-person verification or eKYC (electronic KYC), depending on the available option. CERSAI Verification: Once the KYC documents are submitted, CERSAI performs a thorough verification, ensuring the authenticity and accuracy of the information. Unique CKYC Number: After successful verification, CERSAI assigns a unique 14-digit CKYC identification number to the individual. This number serves as a single point of reference for all future KYC needs across participating financial institutions. For Businesses: Customer Shares CKYC Number: During customer onboarding, a business can inquire if the customer has a CKYC number. CKYC Information Retrieval: If the customer possesses a CKYC number, the business can retrieve their KYC details directly from the CERSAI database with the customer's consent. This retrieval process typically happens electronically through APIs offered by CERSAI or authorized service providers. Seamless Verification: Once the KYC details are retrieved, the business can verify the customer's information and proceed with account opening or product offering without the need for further document collection or verification. Key Points are: Individuals only need to undergo CKYC once. Their KYC information remains valid for a specific period (typically 10 years) unless there are any changes requiring an update. Businesses and financial institutions can leverage CKYC APIs to seamlessly integrate KYC verification into their existing workflows, further streamlining the customer onboarding process. CKYC accounts vary based on documentation and risk profile: Normal Account: Verified with PAN, Aadhaar, Voter ID, Passport, etc. Simplified Measures Account: Uses other official ID proofs Small Account: Minimal details + photograph OTP-based eKYC Account: Uses OTP and photograph verification.