India to Implement Common Customer ID for Financial Institutions
India is set to launch a unified customer identification system, known as Central Know-Your-Customer (CKYC) 2.0, starting in August for banks and insurers, with mutual funds expected to follow later this year. The initiative aims to streamline access to financial products by allowing customers to use a single verified identity across institutions without re-submitting documents each time. The system will require customer consent but eliminate redundant verification processes that have hindered broader adoption of insurance, pensions, and mutual fund investments in the country. India has long sought such an infrastructure similar to systems used in Singapore and Europe. The new framework also aims to improve fraud detection by centralizing data monitoring and assigning accuracy scores to records. Currently, financial institutions operate with a registry containing 1.2 billion customer records but face issues of duplication and incomplete information. Under the updated system, verified records will be accessible via one-time passwords after consent is obtained from customers.
Topics: banks CKYC customer identification system India insurers mutual funds