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What is e-KYC: Meaning, Eligibility and Process

Finance Tips
11 September 2024
Katyaini Kotiyal
3,226

What is e-KYC?
How e-KYC differs from traditional KYC
Documents Required for e-KYC Verification
The e-KYC Process
Eligibility Criteria for e-KYC
Advantages of e-KYC
Types of e-KYC in India
Conclusion
Frequently Asked Questions

Managing finances can sometimes feel overwhelming. Whether it's a planned expense, like buying a home, or an unexpected cost, such as medical bills or urgent repairs, loans can make life easier. But before you get a loan, there's an important step you can't skip: the KYC process.

KYC, or Know Your Customer, is mandatory for all types of loans. Thankfully, with e-KYC, you can complete your verification online, quickly, safely, and without any paperwork or branch visits.

Now, let's dive deeper and understand exactly what e-KYC is and how it works.

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What is e-KYC?

e-KYC, or electronic Know Your Customer, is a process for verifying a person’s identity digitally. Instead of filling out forms and submitting paper documents, your details are checked online using your registered mobile number, PAN and Aadhaar. This makes the process fast, safe, and convenient, helping NBFCs and financial institutions verify your identity without any hassle.

Also Read: What are the Documents Required for Personal Loan Application Online

How e-KYC differs from traditional KYC

Here is a quick look at how e-KYC differs from traditional KYC, highlighting the key changes in methods, processes, costs, and convenience.

Key Points	Traditional KYC	e-KYC
Method	Customers submit physical documents like Aadhaar or PAN, which are manually verified	Digital verification of Aadhaar, PAN, or other identity documents using online e-KYC
Process	Time-consuming, manual, and paper-based	Quick and efficient due to online verification and digital authentication
Cost	High operational costs from manual processing and storing paper documents	Lower costs due to digital verification and paperless process
User Experience	Customers must visit the branch to submit documents, which requires time and effort	Hassle-free; the process can be completed from anywhere using your Aadhaar and mobile number
Accuracy	Manual processing may lead to errors in verification	Enhanced accuracy through digital authentication, reducing mistakes
Security	Physical documents can be lost, stolen, or tampered with	Safer online process; reduces the risk of theft or tampering

Documents Required for e-KYC Verification

To complete the e-KYC process, individuals need to provide their Aadhaar number linked to their registered mobile number and PAN card. With these documents, the applicant's identity and address are verified.

The e-KYC process

The Hero FinCorp e-KYC process is simple and allows you to verify your identity online. Once you fill out the loan application form, provide your Aadhaar number linked to your registered mobile number. You will then receive a One-Time Password (OTP) on your mobile. Enter this OTP to complete the e-KYC verification. This real-time, paperless process verifies your identity quickly, helping you get approval for an instant Personal Loan without any hassle.

Eligibility Criteria for e-KYC

To complete e-KYC for a Personal Loan, an individual must:

Have a registered mobile number to receive the One-Time Password (OTP).
Be 21 years old.
Possess valid PAN and Aadhaar numbers.

These basic requirements make the e-KYC process quick, secure, and convenient for everyone.

Advantages of e-KYC

Switching to e-KYC offers several benefits over traditional methods, enabling identity verification to be much faster. Here are some advantages of e-KYC:

Faster verification With e-KYC, identity verification is quicker than traditional KYC. No paperwork or manual checks are needed.
Convenient You can complete the online verification from home or office using your smartphone, tablet, or computer.
Secure Advanced security, including encryption and two-factor authentication, keeps your personal information safe.
Compliance e-KYC helps financial institutions follow rules that prevent fraud and money laundering.
Better customer experience The process is smooth and hassle-free; just use your registered mobile number, with no long forms or queues.

Types of e-KYC in India

In India, e-KYC can be completed using different methods, depending on what’s most convenient and secure for the customer.

OTP-based e-KYC In OTP-based e-KYC, your Aadhaar authentication is done using a One-Time Password (OTP) sent to your registered mobile number. Entering this OTP completes the verification online. This method is fast, secure, and convenient, allowing identity verification without submitting physical documents or visiting a branch.
Biometric-based e-KYC Biometric-based e-KYC uses biometric verification, like fingerprints or iris scans, to confirm your identity. This process is highly accurate and secure, completing verification in real-time. It ensures that the applicant's identity matches official records, making it ideal for sensitive transactions and providing a reliable alternative to OTP-based verification.

Conclusion

e-KYC is a simple, secure way to verify your identity online. It eliminates the need for physical documents, speeds up the process, and ensures your personal information stays safe. By completing e-KYC using your registered mobile number, eligible applicants can conveniently access loans. This digital process not only saves time but also provides a smooth, hassle-free experience, helping you meet your financial needs without any delays or paperwork.

Frequently Asked Questions

What is the full form of e-KYC?

The full form of e-KYC is electronic Know Your Customer, a digital process to verify a person’s identity online.

What are the types of e-KYC available in India?

You can use OTP-based e-KYC with a registered mobile number, or Biometric-based e-KYC with fingerprints or iris scans.

How can I check the status of my e-KYC online?

Visit the service provider’s website or portal and use your Aadhaar or registered mobile number to check e-KYC status.

Is e-KYC applicable only for loans or other services?

e-KYC is used for loans, bank accounts, insurance, mutual funds, and other financial services, not just loans.

How secure is the e-KYC process?

e-KYC is secure, using digital authentication, encryption, and OTP or biometric verification to protect personal information effectively.

Can e-KYC be done without Aadhaar?

No, Aadhaar number is required for e-KYC process to verify identity and link the registered mobile number.

Is there any cost involved in doing e-KYC?

No, there is no cost involved in completing e-KYC. It is a free process provided by authorised institutions and platforms.

What should I do if I face issues during e-KYC verification?

Contact the service provider’s customer support or helpline to resolve issues with OTP, Aadhaar, or verification errors.

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