In a world dominated by technology, most people and companies are taking their business online to cater to customers all over the world and ensure their presence in the digital world.
However, with the fast-paced world of technology, there are a few cons which come along with it such as security. The internet can often be a vulnerable place for websites as they are vulnerable to hacks and fraud.
To prevent fraud and compromising of security, many websites have introduced KYC or Know Your Customer as an added security measure to their systems. Among all these websites, banks and other financial institutions have implemented KYC to its fullest extent possible.
Banks and their websites have often been the victims of hacks and financial fraud even though there are tons of security layers applied to the website of the bank as well as for net banking transactions. These hacks and financial fraud cases harm the customers along with the bank as well.
What is KYC?
KYC or Know Your Customer is a medium through which companies get to know their customers, especially banks. The banks through the KYC will get access to your Aadhaar details along with your fingerprint and digital signature. This is all done with your consent and is essential for increased security.
The main idea behind KYC is to prevent online fraud, money laundering along with identity theft. With the KYC, banks have increased access to your details, personal information and your banking details to keep a check on all kinds of activity going on in your bank account. All these parameters are within the regulatory and legal framework of the bank as per the guidelines which are given by the Reserve Bank of India.
Here are the situations where your KYC is required:
- Opening a new bank account.
- When you are applying for a loan or a credit or debit card.
- If you are investing in any mutual fund.
- Opening a locker at a bank.
- If there are any kind of changes to be made in beneficiaries or signatories.
Another instance where your KYC is required is when your previous documents held by the bank are not enough. Banks will send a representative to take the necessary details for additional proof and security through the KYC.
KYC with PAN Card
Among the various documents which needs to be submitted as KYC, a PAN card is one of them. To verify your identity and that you are a tax-paying citizen of the country, you must provide your PAN card as a proof of income and proof of identity.
The PAN card is issued to you by the Income Tax Department of India which enables you to file your taxes and tax returns to prove that you are above the tax bracket and that you are a regular tax-paying citizen of the country. A PAN card is must for most of your financial transactions such as opening a bank account, for investing in mutual funds, etc.
However, during the recent Union Budget, the government has stressed on Aadhaar card and PAN card interchangeability where if you do not hold a PAN card, you can still go ahead with various financial transitions with your Aadhaar card.
Steps to Check Your KYC Status with the PAN Card
After you have submitted all the documents and the KYC form online, you can check the status of your KYC online with these steps.
- Visit the website of the Central Depository Service Limited through this link https://www.cvlkra.com/kycpaninquiry.aspx.
- You can check the status of your KYC with either your date of birth or PAN card.
- Enter your PAN card details and click on 'submit'.
- If the KYC has been verified, the status will be displayed as MF-Verified by CVLMF.
- However, if the KYC is verified, it will show 'Pending'.
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PAN Card KYC FAQs
What is controlled by KYC?
The KYC controls the following:
Analysis and collection of basic information regarding an individual's identity.
The xpectation of transactional behaviour of the customer.
Matching the name of the customer against a list of known parties.
What are the documents required for KYC?
Documents may vary for each bank and financial institution based on the requirements but the most commonly requested documents for KYC are proof of identity and address is required. These can include, PAN card, Passport, Voter ID, Utility bills, Birth Certificate, Driving License, etc.
Customers may also be asked to provide a recent coloured photograph of passport size along with the filled and signed KYC submission format. These details will also have to be updated regularly. In case the documents provided are not satisfactory according to the bank then it can close or terminate the account after providing a notice to the customer detailing the reasons for it.
Where can the KYC form be procured?
Individuals can procure the KYC form from their broker or financial consultant. Additionally, they can also download the same from a mutual fund company's website.
In case certain details are changed such as an address, will KYC form have to be submitted again?
Yes, in case the address or other important details about the customer's identity has changed, the KYC form will have to be filled and submitted again.
What does 'Customer' mean according to KYC?
According to KYC regulations, a customer is seen to be an entity or individual that has an account or business relationship with a bank.
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