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To help ease the uncertainties faced by the Indian economy due to the second wave of COVID-19, the RBI has proposed a few changes to the existing KYC norms.
According to the Digital Fifth, these include extension of VCIP for new categories of customers such as proprietorship firms, authorised signatories, and beneficial owners of Legal Entities and for periodic updating of KYC.
This will have an impact on current Account Opening as well as MSME Lending, that will go completely digital. Also, digital SME banks would be launched by banks as well as neobanks in the next 6 months.
Also, there are new updates in the KYC flow, plus RBI introduces more customer-friendly options, including the use of digital channels for the purpose of periodic updating of KYC details of customers. This would mean that customers would be able to use mobile banking as well as internet banking for updating their KYC.
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