India to Launch Unified Digital KYC for Banks, Insurers and Mutual Funds

India is preparing to roll out Central Know Your Customer (CKYC) 2.0, a unified digital KYC framework that will enable banks and insurance companies to access a customer’s verified identity records through a single, consent-based system. Mutual funds, brokerages and other capital market intermediaries are expected to join the platform in a subsequent phase later this year.

The initiative, jointly implemented by the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI) and the Insurance Regulatory and Development Authority of India (IRDAI), is designed to eliminate repetitive KYC submissions while improving customer onboarding, fraud prevention and data quality.

One KYC Across Financial Services

Under CKYC 2.0, customers will only need to complete KYC verification once. After providing one-time password (OTP)-based consent, regulated financial institutions will be able to retrieve verified customer information directly from the central registry instead of requesting the same documents repeatedly.

The upgraded platform also introduces confidence scores that indicate the reliability and verification status of customer records, addressing long-standing issues of duplicate and incomplete data in the existing CKYC database.

Boost for Financial Inclusion and FinTech

Industry experts believe the common KYC framework will reduce onboarding costs, accelerate account opening and expand access to financial products beyond traditional banking.

With India already achieving high levels of bank account ownership, the next phase of financial inclusion is expected to focus on increasing participation in mutual funds, insurance and pension products through seamless digital onboarding.

The initiative is also expected to strengthen fraud detection, improve regulatory compliance and enhance operational efficiency across the banking, insurance and investment sectors.