Finance sector deadline for 'masking' KYC documents extended till Jan 20

Once security measure is enforced, registered reporting entities will only be able to view the last four digits of KYC identifiers such as Aadhaar, PAN, Voter ID, driving licence

The Central KYC Records Registry has extended the deadline for masking – a security measure – Know Your Customer (KYC) documents to January 20 next year, offering relief to financial institutions.

 

What is the Central KYC Records Registry CKYCRR?

 

It is a centralised repository of customer KYC records of the Indian financial sector, aiming to reduce the burden on customers having to produce and verify documents each time they open a new financial account.

 

What is masking

 

Full KYC details like PAN numbers will no longer be fully visible in search results or responses. Instead, only the last four digits will appear in a masked format. This initiative aims to protect sensitive customer information and reduce the risk of data breaches.

 

Key features of KYC masking

 

Masking of identifiers: The mandatory masking of all KYC identifiers, including Aadhaar numbers, ensures that sensitive data is not exposed during transactions or verifications. This means that only a portion of the identifier is visible, preventing misuse of information.

 

Enhanced security protocols: The CKYC system employs advanced encryption techniques to secure stored data. Even if data is intercepted, it remains unreadable without the proper decryption keys.

 

Access control: Strict access controls are implemented to limit who can view or interact with KYC data. Only authorised personnel or entities can access complete identifiers, further safeguarding personal information.

 

Fraud prevention measures: By masking identifiers, the system aims to mitigate risks associated with identity theft and fraud. This proactive approach helps in maintaining the integrity of the KYC process.

 

“In view of requests received from various Reporting Entities, it has been decided to defer the date of go live for masking of KYC Identifier from December 16, 2024, after 08:00 PM to January 20, 2025, after 8:00 PM,” said Central KYC Records Registry in a circular.

 

Starting January 20, 2025, registered reporting entities (REs) will only be able to view the last four digits of KYC identifiers such as Aadhaar, PAN, voter ID, and driving licence. To access the complete KYC records, REs will need to authenticate themselves and download the record using either the masked KYC identifier or a unique CKYC reference ID. This two-factor authentication process is designed to improve data security and prevent unauthorised access.

 

Companies will have to update their systems to support masked KYC identifiers. This includes adjusting search and download processes to use the masked versions rather than the full identifiers. Additionally, they will need to establish procedures for verifying customer identities with the masked identifiers.