IFSCA Updates V-CIP Rules: What Changes for Digital KYC & Remote Onboarding
The International Financial Services Centres Authority (IFSCA) has issued a major refresh to its AML/CFT and KYC framework, introducing a modernised standard for Video-based Customer Identification (V-CIP). These changes strengthen digital onboarding, deepen regulatory clarity, and open new pathways for compliant remote onboarding — including a pilot for low-risk NRI customers.
This update replaces Annexure II (Part-A) for V-CIP of Indian nationals and introduces a structured path for NRI V-CIP. The circular is effective immediately.
🧠 Why it matters
As fintechs, banks, wealth managers, and fund platforms expand globally, secure remote onboarding has become foundational. The new V-CIP norms strike the balance between:
✅ Stronger AML/CFT safeguards
✅ Data sovereignty & cybersecurity
✅ Real-world usability for financial institutions
✅ Customer-friendly digital onboarding
🏛 Key Policy Updates at a Glance
1. Expanded definition of who can conduct V-CIP
V-CIP can now be performed by:
The RE (regulated entity)
A supervised financial group entity in India
A KRA (KYC Registration Agency)
This creates a unified digital KYC pipeline across India’s regulated ecosystem.
2. Strong security & data governance controls
The V-CIP system must:
Comply with IFSCA cyber security norms
Use end-to-end encryption
Block VPN/proxy/IP spoofing
Capture live geolocation and timestamps
Implement liveness, anti-spoof, and anti-deepfake checks
Move all V-CIP data immediately to RE/Group servers
(Cloud allowed, but no retention outside the regulated environment)
Data sovereignty and privacy — front and centre.
3. Operational & compliance standards
All V-CIP officers must be trained
Random questioning + prompting = automatic rejection
Call drop = new session
KYC docs must be fresh (≤ 3 working days)
Only verified digital docs allowed (DigiLocker/e-PAN etc.)
Aadhaar must be masked
Activation only after concurrent audit
This elevates V-CIP to a rigorously audited process, not just a video call.
4. New NRI V-CIP pilot
IFSCA has opened a controlled pilot for low-risk NRIs, limited to select jurisdictions including the US, UK, UAE, Singapore, Canada, Australia, EU, etc.
Key safeguards:
IP must match the declared foreign residence
Verified bank account in that jurisdiction required
Account opens in debit-freeze mode
Fully activated only after first credit confirmation
This is India’s first structured regulatory path toward global remote onboarding from major financial centres.
👀 Bigger picture
IFSCA continues to position IFSC-GIFT City as a globally compliant yet innovation-forward financial hub. With the new V-CIP framework, India’s regulatory stack moves closer to global digital-identity standards seen in Singapore, UAE, and Europe — while preserving data sovereignty and trust.
For fintechs, investment platforms, fund managers, and cross-border wealth players, this is a big unlock.