The Securities and Exchange Board of India (SEBI) has released a draft circular proposing to ease the requirement for Non-Resident Indian (NRI) clients to be physically present in India while updating or modifying their Know Your Customer (KYC) details through digital onboarding or Video Client Identification Process (V-CIP).
The Problem: Under current SEBI rules, intermediaries must capture the client’s geo-tagging data to ensure they are physically located in India during digital KYC, which creates a major barrier for existing NRI clients trying to complete re-KYC from overseas.
The Proposed Relaxation: The draft circular aims to simplify compliance and enhance market participation by allowing NRIs to complete their re-KYC digitally from abroad. The core security protocol remains strict, but the geographical constraint is adjusted:
Geo-tagging Requirement: The intermediary’s application must still capture the client’s GPS coordinates (geo-tagging).
Verification Match: The captured GPS location must be verified to match the country mentioned in the client’s proof of address.
Anti-Fraud Measures: The process must include technology to prevent connections from spoofed IP addresses and incorporate features like random action initiation (e.g., questions) to ensure the interaction is real-time and not pre-recorded.
This move aligns with SEBI’s priority of increasing and streamlining the participation of the Indian diaspora in the domestic securities market. By relaxing the India-specific geo-tagging requirement, SEBI is directly addressing an operational bottleneck that disproportionately affects NRIs, thereby promoting Ease of Doing Business and reducing the administrative costs associated with global client servicing.
What is V-CIP (Video Client Identification Process)?→ V-CIP is a method allowed by SEBI for financial intermediaries to complete an investor’s KYC process digitally and remotely through a secure, recorded video interaction, provided several safeguards are met, including geo-tagging and real-time validation of the client’s identity.
Follow the full update here: Circular on Relaxation of India geo-tagging for NRI clients re-KYCKYC modification through digital on-boarding video client Identification process (V-CIP)
