FinMin working to implement common KYC to cut paperwork for financial transactions

Finance Minister Nirmala Sitharaman on Tuesday revealed that they are working on implementing common KYC to undertake various financial transactions across institutions. Currently, there is a central repository handling central KYC. The common KYC is expected to trim paperwork for Indian citizens on their various financial transactions like opening bank accounts or Demat accounts and making investments among other benefits.

At Ficci Leads 2022 conference here, the FM said, there is a central repository that takes care of central KYC. We are also now working in such a way that once you have given your KYC, it can be applicable at various institutions at various times for various requirements that you may have. And you may not have to do it each time even if the businesses are slightly different from that you’re engaged in, as reported by PTI.

Stating the move will bring ease of doing business in India, she said the government and regulators are working together to bring common KYC all together for financial transactions.

Last week, a discussion was held between financial sector regulators and Sitharaman over the issue of a common know your customer (KYC) process for banking, insurance, and capital markets.

At the event, Sitharaman also spoke about Unified Payments Interface (UPI) transactions. She said UPI targets a billion transactions a day in the next five years, thereby, the platform is readying itself for that kind of an escalation in transactions.

In July this year, UPI crossed 6 billion transactions which s the highest ever since 2016. Launched in August 2016, UPI is a revolutionary, user-friendly, real-time payment solution that facilitates inter-bank transactions, and enables greater digital payments adoption in the country.

Further, in the event, Sitharaman said, the future of finance is going to be driven more and more by the digitization of banks. She sees Artificial Intelligence to play a bigger role in the area of fintech.

Also, Sitharaman expects the use of blockchain technology to rise by about 46% in the next few years.

On climate risks, Sitharaman said, “We need to make sure that climate risks are not going to hit us because we are talking about a future that is digital.”

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