Are you confused about what documents are needed to get your CIBIL report and your company credit rank from CIBIL? Let's understand what is meant by the CIBIL score or rank. CIBIL provides credit information reports. CIBIL (the former Indian Credit Information Bureau now called TransUnion CIBIL) is a credit reporting and scoring agency.
The CIBIL report has a wide array of data, your individual and business information, personal information, risk scores, previous loan repayment history etc. Potential borrowers of credit products like loans, credit cards, etc., are rated on their CIBIL score by the banks, investors and lenders or financial institutions when making a lending decision.
The 3-digit CIBIL score is the most popularly used credit score rating of your financial information and loan repayments, while CIBIL Commercial Credit Rank scores a business’s credit history.
Did You Know? CIBIL is India's most popular and trusted credit scoring agency and contains a database of credit information across 2,400 members and approximately 600 million Indians, banks, lending agencies, etc.
What are KYC documents?
KYC is the acronym for 'Know Your Customer' and is the process of address and identity verification of a financial institution's clients or customers. The RBI in the Reserve Bank of India Guidelines has made the KYC process mandatory for all financial institutions, banks, lending agencies, insurance companies, digital financial payment companies, etc. Thus the KYC checklist contains documents that are used to limit access to financial information to the authorized users only.
KYC documents are used to establish the identity of a legal entity and its address by uploading supporting and relevant documents. In the case of individuals, this could include the Aadhar card, PAN card, IPV or In-Person Verification, and the proof of a registered address. The KYC process has two sections.
- The Uniform KYC or the Central KYC registry details for individuals
- The Additional KYC details as required by the financial institution.
CIBIL's KYC policy has four key ingredients. Namely,
- Customer Acceptance- make a customer's financial information available only with their acceptance. Example: The letter of authorization for the CIBIL check issued by the lending institution.
- Customer Identification- the process and procedures ensure verification of the identification by KYC means.
- On-going transaction monitoring and 'Due Diligence' ensure the transactions are not fraudulent.
- Risk Management- techniques to mitigate frauds and risks.
Also Read: What is CIBIL Rank & Company Credit Report?
KYC Types
There are two types of KYC in India. Namely,
- e-KYC or KYC that is Aadhaar based (Allows you to invest up to ₹ 50,000 a year in mutual funds).
- IPV KYC or the offline and In-Person KYC details verification (Required when you invest greater than ₹ 50,000 a year in mutual funds).
The KYC documents list for individuals or the basic documents used in KYC verification contains individuals' identities and residential addresses. Other than these, the KYC norms also verify the date of birth, registered telephone number, pin code, etc.
Why are KYC documents required?
KYC updates and KYC documentation completion are undertaken frequently at banks. They consist of basic documents and additional documents that may vary from bank to bank depending on the risk perception. Bankers insist on KYC forms when opening accounts to
- Perform financial transactions.
- Facilitate FD investments.
- Open recurring deposit or RD accounts.
- Use a mutual fund account.
- Make online investments.
KYC documentation is also necessary for purchasing insurance policies for long term investments like bonds, etc. The KYC process helps prevent fraudulent transactions, accumulation of black money, money laundering etc., and are mandated by both the Securities and Exchange Board of India-SEBI and the Insurance Regulatory and Development Authority India-IRDAI. KYC is also needed to open stock-trading accounts, DEMAT accounts, digital wallets, registration procedures with various registered bodies and more, where any financial transaction is involved.
The GOI or Government of India guidelines approves six OVDs or 'Officially Valid Documents' for identity and address verification.
For identity proof, you can use any of these from the KYC documents list
- UID or Unique Individual Identification Number containing documents like Voter ID, Aadhaar card, Driving license and Passport.
- The Permanent Account Number or PAN card.
- NREGA Card.
- Identity card with photograph issued by State/Central Governments departments or any Regulatory or Statutory Authorities.
- Identity cards with photographs issued by affiliated Colleges, Schools, Universities, or Professional Bodies like the Bar Council, ICWAI, ICAI, ICSI, etc.
- Identity cards with photographs issued by PSUs or Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions.
For address proof, you can use any of these from the KYC document list
- Basic documents like Voters Identity Card, NREGA Card, PAN Card, Passport, Lease Residential Agreement, Registered Sale of property documents, Driving License, Ration Card, Flat Maintenance bills, Insurance Policy copy.
- Bank Account Passbook and Statement of accounts not older than three months.
- Self-declaration form with address in the case of Supreme/ High Court judges.
- Utility bills not older than three months include gas, electricity, or Landline Telephone bills.
- The following authorities issued the residential proof.
- A Gazetted Officer
- The Notary public
- Scheduled Co-Operative Bank
- Commercial/ Scheduled/ Multinational Foreign Bank Managers
- MP/ MLA/MLC or elected representatives to the Legislative Houses/ Parliament.
- Identity card with photograph issued by State/Central Governments departments or any Regulatory or Statutory Authorities.
- Identity cards with photographs issued by affiliated Colleges, Schools, Universities, or Professional Bodies like the Bar Council, ICWAI, ICAI, ICSI, etc.
- Identity cards with photographs issued by PSUs or Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions.
How to get your company's CCR?
Here is the step-by-step process to get your company's CIBIL Commercial Report.
- Firstly use the CIBIL link https://cibilrank.cibil.com/ and login via the CIBIL commercial member login tab.
- Next, enter the company details like its name, GSTN number, ID, Address, Type, Contact Information, etc. Click on the 'Agree' tab and save the filled-in application.
- Click on 'Continue' and proceed to the payments page to make a payment of ₹3000 for your company's CCR.
- When making an online application, you can use any payment mode and use your debit, credit, pre-paid cards, net banking, UPI payments, etc.
- Once payment is made, you need to authenticate your saved application using the OTP generated after answering CIBIL's GST authentication process and uploading the KYC documents.
- CIBIL dispatches your company credit ranking score and credit information report on successful authentication within 24 hours.
- You can also apply for the CCR offline by sending the printout of the downloaded application duly filled and signed along with your KYC approval documents and fee in the form of a DD or bank draft.
- Your offline application, credit rank/score, and CCR are sent to your address by post.
KYC documents for individuals
The KYC documents required for a bank loan to individuals generally consist of
- The bank's application form filled in with name, date of birth, telephone number, email ID, etc., along with KYC documentation.
- The latest CIR and Credit score which the financial institution will get through a letter of authorization for CIBIL check format letter of authorization issued by you.
- Bank statements for the last year or three months as required.
- Registration and property documentation papers for automobile, home loans etc.
- Income statement or salary slips for the last three months. In the case of self-employed persons, the P&L account statement and balance sheet are issued by a Chartered Accountant.
- 3 Years IT returns.
KYC documents for a private limited company to get CIBIL CCR
What are the KYC documents required at the time of getting the company CCR? For Private Limited Companies, the following KYC documents are required and must be uploaded when making online payment for the CCR.
- Firstly enter the Company ID and its Email ID.
- You will need to provide proof of the company's address through any of the following documents. (Bank Passbook or 3-month Account Statement, Electricity or Telephone Bills not older than three months, the office premises Registered Sale or Lease Agreement, the Shops & Establishment Act Registration Certificate or a verifiable address proof of the company premises issued by Commercial/ Scheduled/ Foreign Multinational Banks).
- TIN or Company PAN for Pvt Ltd Company.
- The Board Resolution document copy with a list of authorized signatories and their specimen signatures.
- Proof of identity of the CCR authorizing signatory (Passport, Driving License or PAN).
Note: All KYC documents for a company should be attested by a Company Secretary, CA, etc.
Conclusion
We have discussed above what KYC documents are and why they are important. KYC is essential for every financial transaction and even to get the CIBIL credit rank for your company when you apply for the CCR to CIBIL.
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