As the lockdown has disrupted economic activities across sectors and with banking not immune to it, there have been faced hindrances in bank account opening process during the current unprecedented times when there are restrictions on movement. So, to overcome it banks have come up with video KYC and the effort has been spearheaded by the private lender Kotak Mahindra Bank.
Later similar financial products have been launched by banks including the likes of RBL Bank and IndusInd Bank.
The video KYC service has typically been launched for accounts that are primarily sourced through the digital channel.
Say for instance, Kotak Mahindra Bank has started off with the facility i.e. entire KYC process through the digital route for its savings account product called Kotak 811. On similar lines, RBL has unveiled a product called RBL Digital Savings Account.
Notably, prior to the RBI's approval on video KYC, for accounts which were sourced through the digital route, KYC was to be done within 12 months of account opening. And until it is completed (i.e. KYC or know your customer has to be done physically), customers were not allowed to keep a balance over Rs. 1 lakh.
How Video KYC works in Bank Account Opening?
For bank account opening, customer needs to visit the concerned bank's website or app and then after providing required credentials such as name, mobile number as well as email address, customer need to give his or her approval of using one's aadhaar for account opening.
Then at a later stage, after the customer gives address and PAN details, video KYC process is initiated on the app.
During the process, the customer is connected to a bank associate who then asks to furnish original documents.
The facility of video KYC is available during office hours i.e. from 9 am to 6 pm.
Also as per the regulations, the person concerned needs to allow the bank app such that customer's location can be accessed.