State Bank of India (SBI), the country’s largest public sector bank, has taken a major step towards simplifying the banking experience for customers. Speaking at the Global Fintech Fest 2025, SBI and Indian Banks’ Association (IBA) Chairman C.S. Shetty said the bank is rapidly working on a plan to make the Know Your Customer (KYC) and re-KYC processes more user-friendly. Shetty stated that SBI is coordinating closely with the government and regulators to implement these changes.
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KYC and re-KYC to receive a new look
The SBI chief stated that the bank is striving to make the KYC system completely convenient and modern. He clarified that the move towards a digital and simplified process is being made to ensure that customers do not have to go through a lengthy process every time. He stated that if necessary, the RBI and the government will also be asked to provide flexibility in the rules.
RBI Amendments Raise Expectations
On June 12th of this year, the Reserve Bank of India made significant changes to KYC regulations, aimed at simplifying the process. The RBI directed banks to send KYC update information to customers ahead of time and to simplify KYC updates in rural and remote areas by using the Business Correspondent model. Instructions were also issued to clear KYC backlogs in government schemes such as DBT, EBT, and Jan Dhan accounts.
Preparations to Improve Credit Model
During the same event, Shetty also stated that adopting an expected credit loss-based model will not negatively impact the banking sector’s balance sheet. He also stated that SBI will further strengthen its loan recovery process before expanding UPI-based credit services. He stated that UPI is poised to become a key medium for inclusive lending in the future, but a robust collection system is essential.
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Future Direction of Digital Banking
C.S. Shetty acknowledged that the digital financial system in India is rapidly evolving and that it is crucial to ensure that crucial processes like KYC are simple and secure. He said that fintech companies, technology developers, and policymakers must work together to ensure that every citizen can easily access banking services.
