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July 31, 2024
Anjali’s experience is a stark reminder of how a seemingly minor error can have a significant impact on your financial journey. Her application for an additional ICICI Bank Credit Card was rejected because her DOB did not match the bank’s previous records. This was a complete surprise, as she was confident that all her documentation was in order. On further thought, she began to check the details of her existing card, and lo and behold, there was an error in the Date of Birth as per the Bank’s current records.
Instances like Anjali’s are more common than you might think. Errors often go unnoticed until they become a hurdle in your financial journey. These errors, usually in minor details, can easily slip past when Applying for a Personal Loan, Credit Card, or any other credit facility.
By meticulously checking and comparing the significant details of your primary documents, such as the PAN Card, Aadhaar Card, Driving License, Passport, Voter ID, and Government-approved ID, you can prevent potential issues in your financial transactions. This level of scrutiny gives you the power to Avoid Common KYC Errors, putting you in control of your financial journey.
Date of Birth Mismatched: An individual’s Birth date is the primary identification detail to be noted and preserved. The time and date of an individual’s birth is the starting point of life and the first recognition of existence. This is the primary reference point to be used for times to come. A birth certificate is the evidence of the date of birth to which further details are added. Each time a KYC Document is issued, your date of birth is mentioned. Be alert that there is no mismatch in the Date of Birth entered in any certificate or KYC Document to avoid discrepancies for further documentation.
Name Mismatched: The applicants’ names and spelling should be ditto on all the primary documents. For example:
The name on the PAN Card is Rahul Kumar Dutt.
The driver’s license has the name Rahul K Dutt.
Though the above seems like the same person for practical details, it is unacceptable for Official KYC Purposes. This confusion often occurs when a customer involuntarily gives one ID document to open a bank account and uses an alternate ID for a credit card application. The name mismatch is a significant reason for the Lender to withhold or reject the request for a Personal Loan or a Credit Card, underscoring the gravity of such errors and their potential impact on your financial transactions.
Spelling Error: The spell check is a must for the identification and address details of all documents. A name could be misspelt, or the address mentioned on two different documents may not match exactly as per the example discussed below:
Aadhaar Card – Mrs Sarika Kapoor 121 Nyaya Marg. New Delhi 21
Bank Statement – Mrs Saarika Kapoor 121 Nyay Marg. New Delhi 22
The error may not be noticeable, but it can be problematic when applying for further credit. Spelling errors can happen due to clerical mistakes while doing data entry or as a wrong copy from a previous document. An incorrect name spelling can often lead to a different individual match when the individual’s CIBIL is checked. An address spelling error will make it challenging to identify the residence and can affect Personal Loan Eligibility.
Documents not updated: The address change, if not updated in the documents submitted as per the current residence location, can cause a verification decline as the old address is captured by the lender staff when entering the details of the customer is possible and can be the cause of a verification decline when the Banks executive makes enquiries at the location entered. The document submitted as an address proof must reflect the address where the applicant is currently residing. Giving a prominent landmark when filling in the address will go a long way toward conducting a successful physical verification.
Submit Clear Copies of Documents: All documents submitted when applying for a credit facility online or by giving hard copies must be updated and precise. Validity is important, as an expired document, such as a driver’s license or passport, will lead to delays.
With digital processing, applicants Apply for Personal Loans Online by giving soft copies of documents. If the original documents lack clarity, processing is withheld. Further, with the introduction of Video KYC, original documents are verified over a video call with the Bank officer. The verification is declared unsuccessful if the records are poorly maintained or damaged.
Other KYC Requirements: The Aadhaar card is now a universally accepted KYC Document with all the details required to process a loan or a credit card. For verification, the Aadhaar card must be linked to the applicant’s mobile number. It is used to verify biometrics and displays the customer’s current address.
The PAN Card must be connected to the Aadhaar card and the bank account; customers with duplicate or 2 PAN cards must submit both cards, as the bank will discover them during the verification process.
Applicants must ensure their KYC Documents are accurate to expedite the processing of loans or credit cards. Incomplete information can also lead to CIBIL errors when the lender views the CIBIL during the loan process.
The RBI (Reserve Bank of India) is coming down on lenders to maintain accurate KYC Records of customers, and banks, in turn, are now prioritising collecting customers’ KYC while processing credit transactions. Doing a check while keeping the above error possibilities in mind will help to enhance your experience with credit further credit applications.
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