eKYC, often called paperless KYC, is the process of electronically verifying the customer’s credentials. This is mandatory for everyone to avail of the services from any financial institution. It is also called Aadhaar-based eKYC as your identity is verified electronically wherein the service provider can access the details of your Aadhaar from the Unique Identification Authority of India (UIDAI) database. Thus, this provides your proof of identity and address to the service provider instantly, eliminating the need for tedious in-person verification.
Aadhaar-based eKYC depends on the information provided by an individual to UIDAI to receive the unique 12-digit Aadhaar number. Upon receiving your Aadhaar number, it is easy to invest in fund houses as they use the eKYC Application Programming Interface (API) to get access to your Aadhaar information. Through this, any licensed service provider can then verify a customer.