Markets regulator Securities And Exchange Board of India (SEBI) on Wednesday relaxed the Know Your Customer (KYC) requirements for individual persons resident outside India, including Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs) and foreign nationals, allowing them to complete the onboarding process digitally.
They can now complete the process from Financial Action Task Force (FATF)-compliant countries without being physically present in India.
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The revised framework will come into effect from Dec. 3, SEBI said in its circular.
Under the framework, intermediaries registered with SEBI can accept digital submission of KYC information and supporting documents from such clients without requiring them to be physically present in India during the onboarding process.
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The move is aimed at simplifying the onboarding process and easing compliance requirements for overseas investors.
"In order to ease the process of onboarding an individual Person Resident Outside India (PROI) client, it has been decided to review the existing provisions governing the KYC process. Individual PROI client shall mean a Non-Resident Indian (NRI), Overseas Citizen of India (OCI) or foreign national," SEBI said.
"The requirement of a client being in India during digital onboarding is being relaxed for an individual PROI client located in a FATF-compliant country, and the intermediary may accept digital submission of KYC information and supporting documents from such client," it added.
The regulator has also introduced greater portability of KYC records, directing KYC Registration Agencies (KRAs) to tag individual attributes as 'validated' wherever they have been verified against official or source databases.
KYC records will remain portable and can be shared with other intermediaries, irrespective of whether every individual attribute has been validated.
Further, intermediaries will be permitted to rely on KYC undertaken by another SEBI-registered intermediary or an entity regulated by other financial sector regulators, based on records available with KRAs or the Central KYC Records Registry (CKYCRR).
However, the intermediary will retain ultimate responsibility for ensuring KYC compliance, including undertaking enhanced due diligence based on the client's risk profile.
Under the revised norms, intermediaries will be required to collect the client's PAN, passport and, wherever applicable, OCI card, along with proof of identity and address. The overseas address will be considered the current address for individual PROI clients.
The regulator has also permitted submission of KYC forms and specimen signatures through electronic modes, subject to prescribed verification requirements.
In cases where physical in-person verification (IPV) is not feasible, intermediaries can undertake Video In-Person Verification (VIPV), subject to safeguards such as live geo-tagging, face-liveness checks, end-to-end encryption and the presence of an authorised official of the intermediary during the process, Sebi said.
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SEBI further said intermediaries must submit the KYC information of individual PROI clients to the KRA within three working days of completion of the KYC process.
The revised framework will also apply to re-KYC of clients residing in FATF-compliant countries.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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