RBI Eases KYC Verification for Foreign Portfolio Investors via Overseas Certified Copies — September 19, 2026

In a notable procedural reform aimed at facilitating cross-border investment inflows, the Reserve Bank of India (RBI) has extended its alternative Know Your Customer (KYC) documentation certification facility to Foreign Portfolio Investors (FPIs). The relief, which was previously available only to Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs), allows domestic lenders to accept original certified copies of KYC documents rather than having to verify them against physical originals.

The central bank rolled out the measure through the Know Your Customer Amendment Directions, 2026, issued on September 18, 2026, making the changes effective immediately.

Simplifying the Onboarding Process

Under standard KYC procedures governed by the Prevention of Money Laundering Act (PMLA) and related rules, regulated entities must compare a copy of an officially valid document or proof of possession of Aadhaar with the original and record an official verification note on the document copy.

For institutional foreign investors operating thousands of miles away, this requirement has frequently created administrative bottlenecks when opening custodial and banking accounts in India. Under the updated framework, eligible FPIs can now fulfill their verification duties by submitting an original certified copy authenticated by authorized entities abroad.

Authorized Entities Permitted to Certify KYC Documents:

• Authorised officials of overseas branches of Scheduled Commercial Banks registered in India
• Branches of overseas banks that maintain relationships with Indian banks
• Notaries Public abroad
• Court Magistrates
• Judges
• Indian Embassies or Consulates General in the country where the overseas investor resides

Broad Coverage Across Regulated Lenders

The RBI confirmed that it conducted a comprehensive review of extant instructions before deciding to widen the scope of the facility. The regulatory amendment substitutes the definition of a "certified copy" across RBI’s regulatory directions governing multiple banking tiers.

The revised guidelines apply across:

• Scheduled Commercial Banks
• Small Finance Banks
• Local Area Banks
• Regional Rural Banks
• Primary (Urban) Co-operative Banks and Rural Co-operative Banks

Significance for Indian Capital Markets

The move is expected to improve ease of doing business for global asset managers, sovereign wealth funds, and foreign institutional pools looking to deploy funds into Indian stocks, bonds, and derivatives.

Custodians and depository participants in India have routinely pointed to onboarding friction as a deterrent to rapid capital allocation. By recognizing certified document channels from trusted foreign authorities and overseas banking networks, the central bank maintains strict compliance standards while meaningfully lowering operational hurdles for overseas institutional investors.

Tags: RBI Foreign Portfolio Investors Scheduled Commercial Banks Capital Markets Banking