The Government of India has amended the Prevention of Money Laundering (Maintenance of Records) Rules, 2005; vide a notification dated July 7, 2015, for setting up of the Central KYC Records Registry (CKYCR).
Central KYC Registry (CKYCR) is the central repository of KYC information of customers. This registry is a one-stop collection of the information of customers whose KYC verification is done once. The Master Direction – Know Your Customer (KYC) Direction, 2016 (KYC Directions)[1] defines CKYCR as “an entity defined under Rule 2(1) of the Rules, to receive, store, safeguard and retrieve the KYC records in digital form of a customer.”
In the notification, it is proposed that CKYCR would receive, store, safeguard and retrieve the KYC records in the digital form of a client, for which necessary amendments to the Rules have been made. In terms of the provision of Rule 9(1A) of the PML Rules, the Regulated Entities (REs) shall capture the customer’s KYC records and upload them onto CKYCR within 10 days of the commencement of an account-based relationship with the customer. REs shall capture the KYC information for sharing with the CKYCR in the manner mentioned in the Rules, as per the KYC templates prepared for ‘Individuals’ and ‘Legal Entities’ (LEs), as the case may be. The templates may be revised from time to time, as may be required, and released by CERSAI. According to the Master Circular of RBI, REs shall upload KYC records about accounts of LEs opened on or after April 1, 2021, with CKYCR in terms of the provisions of the Rules ibid. The KYC records have to be uploaded as per the LE Template released by CERSAI.
The KYC records received and stored by the CKYCR could be retrieved online by any reporting entity across the financial sector to establish an account-based relationship. To collect and report the KYC data, CKYCR made uniform KYC templates for various institutions across financial markets like banks, mutual funds, NBFCs, etc. Separate templates are made for individuals and legal entities. In the case of small accounts, only section 1 of the template which contains the personal details of the proposed customer together with the photograph, signature/thumb impression, and self-certification document is obtained.
A unique 14-digit KYC Identifier will be generated for each client by the registry and the same will be received by the reporting entity. The financial institution is required to communicate the KYC identifier to the respective customer so that the same may be used by the customer for KYC verification with some other financial institution. This will avoid duplication of reporting to the Registry about the same party. The templates also fulfill the reporting requirement under Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standards (CRS). The records held with the Central Registry consist of sufficient backups and also they are tamper-proof, which ensures that the data available with the Registry cannot be lost or destroyed or easily accessed by unauthorized persons.
Any financial institutions that are reporting entities to the Central KYC Registry can access the common data about the clients stored in the central registry. This would decrease the difficulties of producing and verifying KYC documents whenever the customer approaches a new financial entity for a financial product.
The CKYC program is managed by CERSAI (Central Registry of Securitization and Asset Reconstruction and Security Interest in India).
Originally posted on September 28, 2017, updated on May 2, 2023
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