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A step by step guide for a Faster Customer Onboarding

Naresh Kini

According to a 2017 Forrester study covering 140 companies across the financial sector in the United States, 88% of the participants agree that the Onboarding experience has a strong influence on the lifetime value of customers.

It is easy to see why. Customer Onboarding is an important moment of truth for the customer. It is his first intimate experience with the working style of the company. Hence it is recommended that onboarding should be as flexible and frictionless as possible. When customers see the speed, ease, security, and convenience of onboarding, a positive perception of the brand is formed which affects the long term brand loyalty.

More than 50% of the respondents in the same study feel that KYC due diligence was the biggest bottleneck in the Customer Onboarding process. It is not difficult to see why. A typical process collects the relevant client details and documents and shares them with teams like KYC and Compliance. The customer moves on to other formalities like receiving a welcome pack, orientation on services only after the identification checks are complete. This can take a lot of time.

The systems and processes in place in India are not very different than any other country in the world. RBI has made the KYC process mandatory for customers of financial organizations. In fact, according to the RBI’s KYC Mandate, individuals have to submit government registered documents like Passport, Driving Licence, National ID card, or any other “Officially Verified Document” (OVD) for a KYC process at intervals of 2,4,8,10 years based on their risk profile.

The governing idea behind KYC is to prevent fraudulent transactions. Identifying who the financial institutions are dealing with helps them and the Government keep track of Fraud, Money Laundering, and other unscrupulous activities.

Though KYC was introduced as a precautionary measure to mitigate potential losses, it came with its shortfalls. It is notorious to be a time-consuming, expensive, and vulnerable to fraudulent activities. Fortunately, in recent years technology is changing the way KYC processes are conducted, resulting in substantial savings.

A recent example is the introduction of Video KYC using Video Customer Identification Process (VCIP) by a January 2020 RBI update. Financial institutions, Fintechs, Digital wallet providers, and NBFCs will now be able to verify customers without requiring their physical presence.

One important aspect of the RBI VCIP mandate is that the customer needs to send a video or make a video call using the concerned bank of institution’s online domain only. Third-party applications like WhatsApp or Google Duo are not allowed. This puts the onus on financial institutions to provide a secure VCIP infrastructure. There are many solutions providers like Veri5 who offer well researched and feature-rich tools.

Here’s a look at the step-by-step KYC process using the KYC V-CIP solution by Veri5. Not only are the RBI approved VCIP guidelines strictly adhered to but also the solution goes one step further at the end of the interaction. Here’s how.

Step 1 – KYC initiation by customer

An existing or new customer visits the bank or financial institution’s website or mobile app to apply for a service. This request is shared with the institution through API or displayed in the Veri5 digital portal provided to the RE.

Step 2 – SMS sent by the Registered Entity (RE)

Upon receipt of the KYC request, the RE’s agent will send a system generated SMS to the customer inviting him to start the V-CIP process.

Step 3 – Aadhaar authentication by customer

The SMS link will lead the customer to authenticate his Aadhaar details. He will be able to authenticate the Aadhaar details in two ways. First, the customer can submit his key details by uploading an XML file into the system using the Veri5Digital Offline KYC Verification. In this option, the customer need not even submit his actual Aadhaar number. The second way is to verify Aadhaar details using Smart QR which uses the QR code provided on the Aadhaar card.

Step 4 – Video call initiated

After this, a Video KYC call is initiated connecting the customer and the RE’s Agent in a two-way video call. Considering privacy concerns and maintaining a record of the interaction, consent to record and collect data is sought by the agent from the customer.

Step 5 – Picture verification

After receiving the consent, the RE’s Agent will capture a live picture of the customer. This picture will be watermarked with GPS coordinates, Agent name, Agent code, and the date and time stamp.

Step 6 – Document capture

The agent will then request the customer to click a picture of their PAN card which is also watermarked with similar details as the photo.

Step 7 – KYC Completion

This is a culmination of the entire V-CIP process. It is here that the agent will match the live photo taken with the one on the Aadhaar card and the PAN card using proprietary face match technology.

The PAN number is verified with the NSDL database along with the watermarking of GPS coordinates, Agent name, Agent code, date, and time stamp.

Step 8 – Upselling

It is here that the Veri5 solution excels. Getting focused one-on-one client interactions is a rarity today. To help financial institutions make the most of this opportunity, Veri5 provides optional upselling modules that can help banks anticipate client needs and make intelligent suggestions,

One of the biggest concerns for end customers and financial institutes is the security of the call and the data shared during the call. Leading V-CIP solution providers including Veri5 record and save all the data on the financial institutions’ servers itself. The entire call is recorded in a video format while the document shared is saved in an image format for audit, references, or further processing purposes. This is besides the high-end encryption used while saving the data.

Let’s take a look at the benefit of using RBI V-CIP in the Customer Onboarding procedure. To begin with, the process drastically cuts down processing time. By a conservative estimate, it will take 7-8 minutes for the entire KYC process, which in itself is a good measure. Secondly, this allows customers even in remote areas to opt for services provided by financial institutions.

This in itself has dual benefits. On one hand, the consumer can choose financial institutions or products without worrying about being physically present. On the other hand, it adds to the profitability of financial institutions by helping engage with more customers. The next benefit is that financial institutions whether private or government-run can now conduct the periodical KYC process without physically asking the customer to be present. This will allow them to offer uninterrupted services and there will be no break in the lifetime value of the consumer.


Customer Onboarding is a crucial step in the customer’s journey as it sets the tone for future interactions. And the more streamlined, quick and simple it is, the greater are the chances of customer loyalty. After the conclusion of the KYC, the remaining steps including paperwork, welcome kits, and consumer orientation can happen faster. It wouldn’t be wrong to say that V-CIP is set to become the pivot of benchmarked Customer Onboarding processes.

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