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Market regulator Securities and Exchange Board of India (SEBI) has relaxed Know Your Customer (KYC) requirements for Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs) and foreign nationals, allowing them to complete digital onboarding while residing overseas, provided they are in countries compliant with the Financial Action Task Force (FATF) framework.
In a circular issued on Wednesday, the market regulator removed the requirement for clients to be physically present in India for digital KYC. Intermediaries can now accept digital submission of KYC information and supporting documents from individual persons resident outside India (PROIs). The revised norms will come into effect from December 3, 2026.
The move is aimed at simplifying onboarding for overseas investors and reducing repetitive documentation. SEBI has also made KYC records portable across intermediaries, even if some individual attributes have not been validated.
Under the revised framework, KYC Registration Agencies (KRAs) will tag individual attributes as 'validated' if they have been verified against official or source databases. Intermediaries can also rely on KYC undertaken by another SEBI-registered intermediary, based on records obtained from KRAs, or by entities regulated by other financial sector regulators, based on records available with the Central KYC Records Registry (CKYCRR).
These include the Reserve Bank of India (RBI), Insurance Regulatory and Development Authority of India (IRDAI), Pension Fund Regulatory and Development Authority (PFRDA) and International Financial Services Centres Authority (IFSCA).
However, the intermediary onboarding the client will retain ultimate responsibility for KYC compliance, including enhanced due diligence based on the client's risk profile.
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Intermediaries will have to collect the client's PAN, passport and OCI card, wherever applicable, along with KYC information in the prescribed format. PAN details will be verified against the Income Tax database, while passport verification will be undertaken wherever feasible.
For proof of identity and address, intermediaries can collect officially valid documents or deemed officially valid documents. The overseas address will be treated as the current address for individual PROI clients.
Where original documents are unavailable for physical verification, intermediaries can accept equivalent electronic documents through DigiLocker or other verifiable mechanisms, Aadhaar-based e-KYC authentication, or copies attested by specified authorities, including Indian embassies and consulates.
SEBI has prescribed safeguards for Video In-Person Verification (VIPV), which can be used when physical in-person verification is not feasible.
The process will require uninterrupted live video recording with GPS coordinates and time stamps, facial liveness checks and safeguards against spoofed IP addresses, VPNs and proxy servers. The client's IP address must originate from India or a FATF-compliant country and match the country declared in the KYC form and supporting documents.
An authorised official of the intermediary must be present during VIPV, and the process will be subject to concurrent audit to ensure its integrity.
Clients submitting specimen signatures digitally will also have to provide a wet signature before the intermediary during VIPV. This will be matched with the signature submitted earlier.
Intermediaries will have to collect Indian or international mobile numbers and email IDs and verify them through OTP or other verifiable mechanisms. If a mobile number cannot be verified, all communications must be sent to the client's verified email address.
The revised framework will also apply to re-KYC of clients residing in FATF-compliant countries. However, existing KYC requirements will continue to apply to clients residing in FATF non-compliant countries.
SEBI has clarified that KYC completed before December 3 will continue to be governed by the existing framework.
