KYC Documentation

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Definition of KYC

KYC stands for ‘Know Your Customer’ or ‘Know Your Client’. It is a guideline, introduced by Reserve Bank of India for all the Companies lie in BFSI (Banking, Financial Services, and Insurance) Sector in particulars to verify the identity, suitability, and risks involved with maintaining a business relationship.

Though KYC processes are also employed by companies of all sizes for the purpose of ensuring the proper identity of anyone who are and will be involved in business relationship with the companies.

The procedures fit within the broader scope of a bank's Anti-Money Laundering (AML)policy.

Initially, these regulations were imposed only on the financial institutions but now the non-financial industry, fintech, virtual assets dealers, and even the non-profit organizations are liable to follow.

Purpose to follow KYC Policy

The purpose of employing KYC Guidelines is to prevent businesses from being used as any kind of ways for moneylaundering.

What is KYC Documentation

The documents that fit with the fitment of KYC Policy and that can ensure the proper identification of Customer /Client /Business (KYB) are known as KYC documents. And one (Customer /Client /Business) has to submit all the required documents to get involved in any kind of business transaction with another company (Bank and any Financial Services in particular)

Standard KYC Documents

Proof of Identity (POI):

• PAN Card
• Aadhaar Card
• Voter's Identity Card
• Passport
• Driving Licence

Proof of Address (POA):

• Aadhaar Card
• Voter's Identity Card
• Utility Bills (Electricity /Gas /Water Bill)
• Rent Agreement

Disclaimer

 ‘PAN Card’ is also used to verify the ‘Date of Birth’ (DOB) of the ‘Applicant’ with the mentioned DOB in ‘CAF’ (Customer Application Form)

One can open a Bank Account only with ‘Aadhar Card’ as it can be established as a POI and POA at the same time. Since Pan No. is supposed to link with One’s Aadhar Card, hence PAN details can be extracted from Aadhar No.

The Way Forward

In absence of PAN Card:

One can submit a declaration in Form No 60  /Form No 61 in case of agricultural income

In absence of Aadhar Card:

1. Customer Image
2. Customer profile data such as customer name, address, DoB etc.
3. Capture OVD (Officially Valid Documents) to establish POI and POA, i.e., Passport. Driving License. Voter ID card. Job card. Aadhaar letter (if available) etc.

KYC Documents required to open ‘SAVINGS ACCOUNT’

For an Adult (Indian):

POI & POA and Photograph (self attested with signature /LTI- Left Thumb Impression)

For Minors (Indian):

If minor is less than 10 years of age, ID proof of the person who will operate the account to be submitted.

In cases where minor can operate the account independently, KYC procedure for identification /address verification as in the case of any other individuals would apply.

For NRI (Non Resident India):

• A photocopy of Passport
• Valid Visa (work visa, residence visa /permit, dependent visa)
• * Visa not applicable in case of Person of Indian Origin (PIO) holding foreign passport.
• Overseas address proof (utility bills, gas, electricity, bank statements). Proofs should not be over 3 months old

For those travelling first time abroad:

• Passport
• Valid work visa
• Deputation/ offer letter mentioning the overseas work address
• Indian address proof

KYB (Know Your Business)

Know Your Business ( KYB) is an extension of KYC Policies. KYB is a set of practices to verify a business. It includes verification of registration credentials, location, the UBO (Ultimate Beneficial Owners) of that business, etc. Also, the business is screened against blacklists and grey lists to check that it was involved in any sort of criminal activity such as money laundering, terrorist financing, corruption, etc. KYB is significant in identifying fake business entities and shell companies. it is crucial for efficient KYC and AML compliance.

KYB Documents are required to open Current Account

KYB Documents required to open ‘CURRENT ACCOUNT’

Sole Proprietorship Firm

1. Two documents in the name of the sole proprietorship firm confirming the name and address- issued by a Government authority /department, as registration /license document (get the lists of documents)
2. POI &POA of the sole proprietor
3. Latest passport-size colour photograph of the sole proprietor
4. In case Power of Attorney (POA) has been granted for account operations, then POI & POA of Power of Attorney have to be submitted

Hindu Undivided Family (HUF)

1. Latest passport-size colour photograph of the karta /authorized signatories of the account
2. POI & POA of the karta /authorized signatories of the account
3. Permanent Account Number (PAN), if not provided earlier. The PAN should be in the name of the HUF

Partnership Firm

1. Latest passport-size colour photographs of authorized signatories and Partners of the account
2. POI & POA of authorized signatories and Partners of the account
3. Communication address proof of the entity (get thelists of documents)
4. Permanent Account Number (PAN) of the entity, if not provided earlier

Private /Public Ltd. Company

1. Updated list of directors (Annexture 1- List of Directors- On Company’s Letter Head- Declaration)
2. Communication address proof of the entity, if it is different with the address mentioned on Certificate of registration (get thelists of documents)
3. Permanent Account Number (PAN) of the entity, if not provided earlier
4. Latest passport-size colour photograph of each of the authorized signatories.
5. POI & POA of each of the authorized signatories
6. Shareholding pattern /list of beneficial owners holding more than 25% in the company either directly or indirectly (on Company’s letterhead)
7. POI & POA of such beneficial owners as identified above
8. POI & POA of the Senior Managing Official in case the ultimate natural person is not identified as the beneficial owner

Limited Liability Partnership (LLP)

1. Certificate of Registration issued by Registrar of LLP
2. Communication address proof of the entity, if it is different with the address mentioned on Certificate of Registration. (get thelists of documents)
3. Permanent Account Number (PAN) of the entity, if not provided earlier.
4. Latest passport-size colour photograph of each of the authorized signatories.
5. POI & POA of each of the authorized signatories
6. Shareholding pattern /list of beneficial owners holding more than 15% in the company either directly or indirectly (on letterhead). This is required only for multiple layer of holding
7. POI & POA of such beneficial owners as identified above

Trust, Society, Association & Club (TASC)

• Constitution document of the entity viz.

The Trust Deed in case of public /private trust or Bye-laws in case of society /association /club

Memorandum of Association or Article of Association in case of sec-25 companies

Rules of acts or Gazette notifications in case of Govt. Quasi –Govt. or Semi –Govt., entities or entities established under Act under which the entity is established

• The list of directors /Members of the Managing committee /the Managing Council

• A copy of the proof of identity of the entity viz.

Registration Certificate issued by Registrar in case of societies /by charity commissioner in case of trust or societies engaged in charitable work

Certificate of Incorporation issued by Registrar of Companies in case of companies

Recognition certificate in case of educational institutions.

• Permanent Account Number (PAN) or proof of exemption from income tax (if applicable)
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• Proof of communication address of the entity
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• Latest colour passport size photograph of each of the existing authorized signatories
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• POI & POA of each of the existing authorized signatories
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• List of beneficial owners holding more than 15% in the Trust. (Directly /Indirectly) (on letterhead)
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• Permanent Account Number (PAN) /POI & POA beneficial owners as identified above

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