DigiLocker KYC – How Insurers Can Onboard Using DigiLocker

DigiLocker KYC: An Overview

DigiLocker is a Ministry of Electronics and Information Technology (MeitY) flagship initiative launched as part of the Digital India Programme. DigiLocker is a secure document repository created for the use of Indian citizens and businesses to store and retrieve important identifying documents easily. 

According to MeitY, “Targeted at the idea of paperless governance, DigiLocker is a platform for issuing and digitally verifying documents & certificates, thus eliminating the use of physical documents. DigiLocker has helped bring a paradigm shift towards paperless governance, i.e., it helped citizens and departments shift from paper-based to paperless processes.”

It also assists in maintaining a secure digital record of the original documents in the cloud and makes them available for various authentication reasons as requested by the user.

The app is hosted in accordance with ISO 27001 standards to protect your personal and financial information. The program also employs 256-bit SSL (Secure Socket Layer) certifications, which ensures that the data you supply to issue papers is secured. To get papers from the government or registered issuers, users must verify themselves using their Aadhaar data.

DigiLocker can also be used by regulated financial institutions (FIs) to conduct KYC verification before customer onboarding. DigiLocker KYC, as this process is known, involves integrating with DigiLocker to retrieve and verify KYC documents after obtaining the customer’s consent.

DigiLocker KYC’s goal is to provide citizens with ‘Digital Empowerment’ by allowing them to access authentic digital documents via a Digital Document Wallet.

How Does DigiLocker KYC Work?

Citizens can digitally scan and store their documents using DigiLocker.

Each citizen will receive one gigabyte (GB) of cloud storage. Citizens may also use the eSign function to keep signed copies of documents. Signing up with KYC DigiLocker is simple and involves installing the app on your smartphone.

An OTP will be sent to validate the mobile phone or Aadhaar number. Users will also have to create a PIN for security reasons. After completing the sign-up process, users may obtain documents from the issuers or keep them in a digital locker.

A DigiLocker KYC journey must adhere to certain DigiLocker guidelines.

According to the Unique Identification Authority of India (UIDAI), MeiTY, and other agencies, the following conditions must be met for a compliant DigiLocker flow:

• The customer must be automatically sent to the DigiLocker website.
• Customers must submit their Aadhaar KYC DigiLocker data, OTP, and captcha.
• Obtain the subscriber’s permission to view documents in the subscriber’s Digital Locker account.
• The verification must be carried out by a DigiLocker-registered requesting partner.

How do Insurers Use DigiLocker KYC?

The insurers looking to leverage the DigiLocker KYC process must follow certain prescribed steps.

The financial institutions work using a ‘requestor’. A requestor tends to be a legitimate entity that has registered with the Digital Locker directory. It retrieves the KYC DigiLocker account of the user, authenticates them, and utilizes them as Proofs of Identity and Address.

According to DigiLocker, the requester must utilize it to —

• Create an account in the Digital Locker KYC directory;

• Access documents posted to the Digital Locker site by the subscriber;

• Access these documents stored across repositories using authorized gateway providers;

• Use the URI (Uniform Resource Identifier) to access the subscriber’s State or Central department, agency, or body corporate issued documents; and

• Get the subscriber’s permission to view documents stored in the subscriber’s Digital Locker account.

The DigiLocker KYC system allows you to save digital documents and certifications to avoid the drawbacks of physically holding papers. Here are a few things insurers and policyholders should know about DigiLocker insurance:

• Allows to save and retrieve documents at any time.
• Allows the appropriate government bodies to authenticate digital documents.
• Easily save and retrieve digital car/driver papers like the Registration Certificate (RC), Driving Licence (DL), vehicle insurance, and so on.
• According to Rule 9A of the Information Technology Rules, 2016, documents kept on DigiLocker are deemed equal to tangible documents.
• Present and verify digital papers to pertinent authorities at any time using the mobile app.

The National Insurance Repository (NIR) provides policyholders with a platform to store all their insurance policies in digital format in a single e-insurance account (eIA). However, it does not permit the storing of other important papers. Life insurance firms will provide insurance papers using DigiLocker, according to the Insurance Regulatory and Development Authority of India (IRDAI).

Advantages of DigiLocker for Insurance KYC

DigiLocker, as a one-stop solution for comprehensive document storage, solves the problem of insurance document loss or misplacement. All KYC documents will be in one location, improving ease of access.

With DigiLocker KYC, policyholders can submit their KYC documents digitally. Storing physical copies of long-term insurance plans over time is difficult; hence DigiLocker KYC solves the issue of misplaced documents.

Other advantages of DigiLocker for policyholders include:

• Customers can expect insurance services to be completed quickly.
• Fraud will be reduced since documents will be accessible to authorities registered with DigiLocker
• The time required for claims processing and settlement will be significantly reduced.

According to the IT Act of 2000, any document retrieved through DigiLocker can be classified as a ‘verified’ document. This means that any document on DigiLocker is issued by reliable sources, making the due diligence process simpler when relying on DigiLocker KYC.

For example, the UIDAI and the Income Tax Department issue Aadhaar and PAN into DigiLocker. All the documents these sources provide bear a verified digital signature, demonstrating that they are legitimate.

Additionally, the two-step authentication method based on the Aadhaar number guarantees that only the user may access their DigiLocker account, which improves data security.

How To Find The Right DigiLocker KYC Partner

Businesses require a service provider whose solutions are:

• Easy to integrate with
• Compliant with AML and CDD regulations put forth by the IRDAI
• Proven, scalable, and create tangible value for businesses
• Easy to use and provide an enhanced customer experience

SignDesk offers an IRDAI-compliant insurance KYC solution, adhering to DigiLocker guidelines. Users can simply leverage the SignDesk platform to log into their DigiLocker accounts and then utilize the integrations we’ve built to sign, stamp, verify, edit, or process the documents stored on DigiLocker. 

Organizations with DigiLocker integrations can leverage SignDesk to get client documents verified, eSigned & digitally stamped on the go. These documents are stored in the DigiLocker vault after completing these processes.

In essence, the security provided by DigiLocker is augmented by SignDesk’s documentation capabilities. The result is a secure repository that businesses and individuals can use to perform all kinds of documentation activities, including insurance KYC, policy document signatures, agreement stamping, document verification processes, and more. 

Make SignDesk Your Insurance KYC Partner Today 

SignDesk is an award-winning, AI-powered KYC verification solution designed for efficiency and simplicity. Our KYC solution provides smooth and immediate client verification using OCR verification for image data extraction, AI algorithms for real-time document verification, and customized onboarding procedures.

SignDesk’s VBIP solution streamlines insurance KYC, policy documentation, claims verification, and processing using templatized drafting, OTP eSignature integrations, real-time face & ID match, and liveness checks. Our use case-specific dashboard allows teams to easily govern document workflows and improve visibility for high-impact processes.

Our KYC verification APIs may be used by businesses for Aadhaar eKYC, biometric KYC, or video-based KYC verification. SignDesk’s KYC verification solution is a trusted and proven platform for businesses across sectors to onboard clients digitally and manage AML compliance.

Book a demo with our product specialists to learn more about how our KYC verification solution can help you digitally transform insurance KYC.