KYC (Know Your Customer) is a process used by banks and other financial institutions to verify the identity of their customers. The goal is to ensure that they know who their customers are, to prevent fraud, money laundering, and to comply with legal requirements. OVD (Officially Valid Document) plays a crucial role in the KYC (Know Your Customer) process. These documents are used by financial institutions to verify a customer’s identity and address.
What is OVD in Banking & its Full Form?
OVD in banking refers to Officially Valid Documents. These are documents recognized by financial institutions as valid proof of identity and address for various financial transactions or account-related processes. In India, OVDs are primarily used for KYC (Know Your Customer) procedures when opening bank accounts, applying for loans, or conducting other financial activities.
What are the Documents Included in OVD?
Officially Valid Documents (OVDs) for KYC (Know Your Customer) purposes include:
- Passport
- Driving License
- Voter ID Card
- PAN Card
- Aadhaar letter issued by UIDAI
- Job Card issued by NREGA and signed by a State Government official
Additionally, personal details like name, address, age, gender, etc., along with a photo from the e-KYC process through UIDAI, can also be considered as an OVD. This helps simplify the verification
Role of OVD in KYC Process
- Identity Verification: OVDs like a passport, driving license, PAN card, or Aadhaar card help to confirm your identity. These documents contain personal details such as your name, date of birth, and photograph, making it easy for banks to verify who you are.
- Address Verification: Documents like a voter’s ID or utility bill serve as proof of your address. This helps the bank ensure they have the correct details for you.
- Legal Requirement: Financial institutions are required by law to collect and verify OVDs from customers for the KYC process, helping to prevent illegal activities like money laundering or fraud.
