Correspondent: Vijaypal New Delhi

India’s banking and financial services sector is set for a major digital upgrade as the government moves to integrate the Know Your Customer (KYC) process with DigiLocker. The rollout of CKYC 2.0, expected later this month, aims to eliminate repetitive verification requirements and usher in a seamless, paperless banking ecosystem.


The initiative is being seen as a transformative step toward modernizing customer onboarding and strengthening digital infrastructure across banks, insurance companies, and mutual fund institutions.


What Will Change?
Under the proposed framework, the Central KYC Records Registry (CKYCRR) will be upgraded and integrated with DigiLocker. This will allow financial institutions to verify customer documents—such as Aadhaar, PAN, and driving licences—directly from secure government databases.


Instead of submitting physical copies repeatedly, customers will benefit from API-based digital verification, enabling instant authentication of credentials.


How the Verification Process Will Work
DigiLocker, a secure cloud-based platform, enables citizens to store and access government-issued documents digitally.
With CKYC 2.0, institutions will be able to:
Conduct real-time document verification through DigiLocker
Search CKYC records using mobile numbers
Integrate PAN, Aadhaar, and other documents via API connectivity
Update, freeze, or unfreeze customer records digitally
The integration is expected to curb fraud, enhance transparency, and significantly reduce processing time.


Simplifying Financial Access
The Union Budget for FY 2025–26 had signaled the government’s intent to streamline KYC norms and promote digital banking adoption. The objective is to ensure faster delivery of financial services and improve ease of doing business for both institutions and customers.


According to official data, thousands of institutions are already connected to the CERSAI-managed CKYC registry, all of which stand to benefit from a unified digital framework.


A Leap Toward Modern Banking
Experts believe the move will strengthen the Digital India mission and align India’s banking ecosystem with global best practices.
Key anticipated benefits include:
Paperless documentation
Faster customer onboarding
Enhanced data security
Greater operational transparency


With DigiLocker-enabled KYC, the financial sector is poised for a more efficient and secure future—marking not just a technological upgrade, but a decisive leap toward the next phase of digital banking in India.