In order to make onboarding to the National Pension System (NPS) simple, faster and cost-effective, the Pension Fund Regulatory and Development Authority (PFRDA) has allowed registered intermediaries to use Video-based Customer Identification Process (VCIP). The subscriber’s verification can be done without the physical presence before the Point of Presence (PoP). The VCIP will not only help in expanding the reach of NPS as the account opening will be paperless, it will also help in speedy account closure and any service request related to NPS.
In fact, last month the insurance regulator had advised all insurance companies to use video-based identification process for doing KYC. Most banks and non-banking financial companies have also rolled out video KYC after the Reserve Bank of India this January allowed them to complete full KYC through this process.
Mobile application-based VCIP
The (VCIP) option will be available to NPS subscribers in addition to the existing options including OTP/ eSign-based onboarding, offline Aadhaar based onboarding, e-nomination and e-exit for eNPS subscribers. The PoPs will have to implement their own mobile application for VCIP. The application will facilitate taking photographs, scanning of documents and uploading of officially valid documents via DigiLocker. The application will have time stamping and geo-location tagging to ensure physical location in India.
The PoPs have to ensure that the process is seamless, real-time, secured and end-to-end encrypted audio-visual interaction with the subscriber. They have to ensure that the quality of the communication is adequate to allow for establishing the identity of the customer and will carry out a liveliness check to guard against spoofing and fraudulent manipulation.
All the PoPs will carry out software and security audit and validation of their app performing VCIP. They will have to ensure instant bank account verification of the beneficiary. At the time of onboarding, the photo and signature of the subscriber will be uploaded during VCIP. At the time of exit, the withdrawal document and the KYC will have to be uploaded for issuing annuity by the service providers.
Non-mobile app-based VCIP
The PoPs will have to take live VCIP of the subscriber after getting his consent. The activity log of the person doing the live VCIP will be stored securely along with time stamping. The video will have to be easily recognizable. The VCIP process will include random question and response from the NPS subscriber including displaying the officially valid document as specified by PFRDA. The video call must be from the domain of the concerned PoP and not from a third-party source. The PoP can add additional safety and security features, other than the ones that are prescribed. The photo and signature of the subscriber will have to be uploaded during VCIP while onboarding.
Customer-friendly measures
In order to make NPS popular, PFRDA has introduced OTP-based authentication for paperless onboarding in June. Customers of bank-PoPs who open NPS accounts through internet banking of the respective banks can authenticate using OTP through registered mobile number or by e-signature. The regulator has also introduced Aadhaar-based offline paperless KYC verification process.
The UIDAI’s paperless offline Aadhaar e-KYC allows Aadhaar number holders to voluntarily use it for establishing their identity in various applications in paperless and electronic fashion while maintaining privacy and security. The offline KYC XML is a secure shareable document which can be used by subscribers having Aadhaar number. The process enables immediate generation of active NPS accounts due to instant KYC verification.
PFRDA has also introduced D-Remit where subscribers can deposit their contributions via net banking by creating a Static Virtual ID linked to their permanent retirement account number (PRAN).
