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Digital onboarding has become a common practice among many Indians, yet misconceptions surrounding e-KYC continue to persist. These misunderstandings often arise from confusing legitimate verification processes with fraudulent schemes.

Myth 1: KYC and E-KYC Are the Same

Reality Check: The distinction between KYC and e-KYC lies in their methods rather than their objectives. KYC is the process of verifying identity, while e-KYC represents a digital approach to fulfilling that requirement, tailored to the risk level of the product.

Myth 2: E-KYC is Unsafe

Reality Check: A well-designed e-KYC process incorporates security measures like encrypted data transfers and systematic consent prompts. In regulated settings, digital KYC methods are generally accepted when conducted through authorized channels.

Myth 3: Aadhaar Data is Vulnerable During E-KYC

Reality Check: Compliant Aadhaar e-KYC processes aim to access only essential information for verification while ensuring data is handled securely through permissions and defined retention policies.

Myth 4: Sharing OTP is Safe

Reality Check: While OTPs can be part of legitimate verification, they should only be used within a trusted process initiated by the user. Any unsolicited request for an OTP should be treated with suspicion.

Myth 5: Biometric Data is Stored

Reality Check: In compliant e-KYC biometric processes, the focus is on verifying a match rather than storing raw biometric data. Risks arise from using untrusted devices or unauthorized agents.

Myth 6: E-KYC is Limited to Basic Services

Reality Check: E-KYC Aadhaar is utilized across various onboarding processes, with methods varying based on service type and risk category.

Myth 7: Digital KYC is Flawless

Reality Check: While digital KYC can be efficient, it may encounter real-world challenges such as connectivity issues, device compatibility, and discrepancies in records.

Myth 8: E-KYC is a One-Time Process

Reality Check: Although the initial verification may remain valid, service providers may request updates as necessary, and fraud attempts can still occur post-verification.

Conclusion

The myths surrounding e-KYC in India often stem from misunderstandings about the verification process and the prevalence of scams. By distinguishing genuine e-KYC flows from fraudulent solicitations, individuals can better navigate the digital onboarding landscape.

Frequently Asked Questions

Q1: Is e-KYC the same as uploading documents online?

Not necessarily. Uploading documents is one method, but e-KYC may also involve electronic verification steps.

Q2: Is Aadhaar e-KYC online unsafe?

It is not inherently unsafe, but safety relies on initiating the process on trusted platforms.

Q3: Should I share an Aadhaar e-KYC OTP with support staff?

Generally, avoid sharing OTPs. Use them only within the official app or portal.

Q4: Does e-KYC biometric mean my fingerprint is stored?

Biometric verification is typically designed to match rather than store data.

Q5: Why do scams persist despite digital KYC?

Many scams exploit social engineering tactics rather than breaking verification systems.