How to Do KYC Online – All You Need to Know

Radha wanted to start using digital banking, so she visited the government’s official KYC portal. She entered her 12-digit Aadhaar number 4321 8765 2109, uploaded her ID and address proofs, and submitted a selfie for biometric verification. Within 10 minutes, after entering the OTP sent to her registered mobile number +91 99887 66554, her KYC was successfully completed, allowing her to transact up to ₹1,00,000 daily.

What is KYC and Why is it Important?

Financial companies utilise the KYC (Know Your Customer) regulation process to verify their customers' identities, addresses, and financial histories. In order to protect the integrity of the financial system and stop illegal activities like money laundering and terrorism funding, the Reserve Bank of India (RBI) and other regulatory agencies like SEBI and IRDAI have required KYC in India.

Key Objectives of KYC:

• Preventing Financial Crimes: By verifying customer identities, KYC helps in detecting and preventing illegal activities like money laundering, fraud, and financing of terrorism.
  
  
• Ensuring Regulatory Compliance: Financial institutions are required to adhere to KYC norms set by regulatory bodies, ensuring they operate within the legal framework.
  
  
• Protecting Financial Institutions: Implementing KYC procedures helps banks and other financial entities avoid being exploited for illicit activities, thereby safeguarding their operations and reputation
  
  
• Facilitating Financial Inclusion: A solid KYC process enables more individuals to access financial services, promoting broader economic participation.

Example:

In a notable case, a consumer court in Dehradun ordered a bank to refund ₹2.4 lakh to a customer who lost money due to an online fraud. The court found that the bank failed to perform proper KYC checks on the accounts to which the funds were transferred, highlighting the critical role of KYC in preventing financial fraud

As digital transactions continue to rise, with platforms like UPI facilitating payments exceeding ₹12 lakh crore monthly, the importance of KYC in maintaining a secure and trustworthy financial ecosystem cannot be overstated.

Documents Required for Online KYC

Tips for a Successful Online KYC:

• Keep all documents updated and valid — Expired documents are usually rejected.
• Scan documents in colour and high resolution — Avoid blurred or cropped images.
• Ensure your mobile number is linked with Aadhaar — Required for OTP-based verification.
• Use Aadhaar e-KYC if available — It's the fastest and most accepted method.

Step-by-Step Guide to Complete KYC Online

Quick Tips:

• Mobile Number Must Be Linked with Aadhaar for OTP receipt.
• Keep Your Share Code Confidential — it's the password to access your data.
• Update your Aadhaar regularly to reflect your current address and details.

How to Verify Your Identity Using Aadhaar e-KYC?

1. Online Aadhaar e-KYC

This method allows for real-time identity verification using your Aadhaar number and either an OTP or biometric authentication.

Steps for Online e-KYC:

1. Initiate e-KYC with Service Provider:
   
   
   • Provide your Aadhaar number to the service provider (e.g., bank, telecom operator).

Authentication:

• Option 1: OTP-Based Authentication:
  
  
  • The service provider will send an OTP to your Aadhaar-linked mobile number.
  • Enter the OTP on the provider's interface to authenticate.
    
    
• Option 2: Biometric Authentication:
  
  
  • Provide your fingerprint or iris scan to the service provider.
  • The biometric data is sent to UIDAI for verification against their database.

Data Sharing: Upon successful authentication, UIDAI shares your demographic details (name, address, photo) with the service provider.

Verification Completion: The service provider verifies the received data and completes the KYC process

2. Offline Aadhaar e-KYC (Paperless Offline e-KYC)

This method enables you to share your KYC details without revealing your Aadhaar number, ensuring enhanced privacy.

Steps for Offline e-KYC:

1. Access the UIDAI Portal:
   
   
   • Visit the official UIDAI website: https://uidai.gov.in.
     
     
2. Go to the -KYC Section:
   
   
   • Go to “My Aadhaar” > “Aadhaar Services” > “Aadhaar Paperless Offline e-KYC”.
     
     
3. Enter Aadhaar Details:
   
   
   • Input your 12-digit Aadhaar number or 16-digit Virtual ID (VID).
     
     
4. Generate Share Code:
   
   
   • Create a 4-character Share Code. This code will be used to access your KYC data.
     
     
5. Authentication:
   
   
   • An OTP will be sent to your Aadhaar-linked mobile number. Enter the OTP to authenticate.
     
     
6. Download KYC File:
   
   
   • After successful authentication, a password-protected ZIP file containing your KYC data (in XML format) will be generated.
     
     
   • The password for the ZIP file is the Share Code you created earlier.
     
     
7. Share with Service Provider:
   
   
   • Provide the ZIP file and the Share Code to the requesting service provider.
     
     
   • The provider can decrypt the file using the Share Code to access your KYC details.

Example: Radha wants to open a new savings account online using Aadhaar offline e-KYC. Here's how she 

completes the process:

1. She visits https://uidai.gov.in and goes to Aadhaar Paperless Offline e-KYC.
   
   
2. She enters her 12-digit Aadhaar number: 1234 5678 9012.
   
   
3. She creates a 4-character Share Code: AB12.
   
   
4. An OTP is sent to her Aadhaar-linked mobile: +91 98765 43210.
   
   
5. Radha enters the OTP: 743920 to authenticate.
   
   
6. She downloads a ZIP file named offlineekyc.zip that contains:
   
   
   • KYC XML data (name: Radha Sharma, DOB: 12-08-1994, Address: Bhopal, MP)
   • A digitally signed QR code
     
     
7. She shares the ZIP file and the Share Code (AB12) with the bank.
   
   
8. The bank uses the Share Code to decrypt the file and verify Radha’s identity.

Her KYC is completed without her full Aadhaar number being shared directly.

Conclusion

An easy, quick, and secure way to verify your identification from anywhere is to complete KYC online. You can complete it in a few minutes using either the paperless offline method or Aadhaar-based e-KYC (OTP or biometric). With your Aadhaar number, mobile linkage, and documents pre-ready, you have convenient access to banking, telecom, and finance facilities without ever having to visit a branch.

Faqs

1. What is the easiest way to complete KYC online?

Use Aadhaar e-KYC via OTP authentication on your registered mobile number.

2. Is Aadhaar mandatory for online KYC?

No, but it simplifies and speeds up the process significantly.

3. How long does online KYC take to complete?

Typically, it takes 5 to 15 minutes if all documents are ready.

4. Can I do online KYC without visiting a bank branch?

Yes, the entire process can be completed digitally from home.

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