VKYC for Banks vs NBFCs vs Insurance vs Mutual Funds: Use Cases & Requirements

A bank onboarding 5,000 customers a day and a mutual fund onboarding a handful of new investors a week cannot run the same Video KYC flow yet many institutions still try, and pay for it in drop-offs, compliance gaps, or fraud they didn't see coming.

Video KYC isn't one-size-fits-all. While the underlying RBI V-CIP framework applies broadly, banks, NBFCs, insurers, and mutual funds each have different risk profiles, customer journeys, and regulatory nuances that shape how VKYC should be implemented.

Below, we break down the use case, requirements, and key considerations for each of the four major BFSI segments banks, NBFCs, insurance, and mutual funds so you can match your VKYC setup to your actual risk and volume profile, not a generic template.

If you're new to Video KYC itself, start with our pillar guide:Video KYC in India: The Complete Guide (2026). This post builds on that foundation with a sector-by-sector breakdown.

Banks

Use case:Savings/current account opening, credit card issuance, loan disbursement.

Requirements:

• Full CDD under RBI V-CIP for account opening
• High-volume onboarding support — banks often process the largest daily volumes of any BFSI segment
• Strong liveness detection given the higher fraud incentive around bank accounts
• Integration with core banking systems for real-time account activation

Banks generally need the most robust, high-throughput VKYC setup of any sector, since account opening volumes and fraud attempts are both highest here.

NBFCs

Use case: Personal loans, gold loans, consumer durable financing, buy-now-pay-later products.

Requirements:

• Fast turnaround — NBFC customers often expect near-instant loan approval, so VKYC completion time directly affects conversion
• Ability to handle spiky, campaign-driven volumes (e.g., festive season loan pushes)
• Strong fallback flows, since NBFC customer bases often skew toward tier-2/tier-3 cities with variable connectivity

For NBFCs specifically, choosing the right provider on cost and speed matters a lot see our Pricing Guide for what to expect when budgeting for VKYC at NBFC transaction volumes.

Insurance

Use case: Policy issuance, especially for high-value life insurance and health insurance policies.

Requirements:

• VKYC often paired with additional verification (medical disclosures, nominee details) within the same session
• Slightly longer acceptable completion time than banks/NBFCs, since insurance onboarding already involves more information gathering
• Strong audit trail requirements, since insurance claims can be contested years later and the KYC record may be referenced

Mutual Funds

Use case: Investor onboarding for SIPs, lump-sum investments, and folio creation.

Requirements:

• Lower fraud-risk profile per transaction compared to loans, but high regulatory scrutiny (SEBI + RBI intersection for KYC registration agencies)
• Often needs integration with KRA (KYC Registration Agency) systems for cross-fund KYC reusability
• Simpler, self-service-friendly flow, since mutual fund investors are typically more digitally comfortable and price-sensitive on onboarding friction

Common Thread Across All Four

Regardless of sector, every one of these institutions faces the same core challenge: verifying identity remotely without compromising on compliance or opening the door to fraud. This is exactly why liveness detection and anti-spoofing capability matter so much in your choice of provider see our detailed breakdown in VKYC Fraud & Liveness Detection: How to Prevent Deepfakes and Spoofing.

Choosing the Right VKYC Partner for Your Sector

The right VKYC setup for a bank processing thousands of accounts a day looks different from a mutual fund onboarding self-directed investors. Pixl works across all four sectors, tailoring completion speed, fallback handling, and integration depth to each institution's volume and risk profile.

Conclusion

Banks, NBFCs, insurers, and mutual funds all operate under the same RBI V-CIP umbrella, but their onboarding volumes, customer profiles, and risk exposure are different enough that a generic VKYC setup rarely serves any of them well. Banks need scale and speed, NBFCs need fast turnaround with strong fallback handling, insurers need detailed audit trails, and mutual funds need lightweight, self-service-friendly flows.
Getting this sector fit right is what separates a VKYC implementation that merely checks a compliance box from one that actually improves conversion and reduces fraud risk.

Pixl builds VKYC journeys tailored to each of these sectors matching completion speed, connectivity fallback, and integration depth to your specific volume and risk profile, so you're not stretching a one-size-fits-all solution across a use case it wasn't built for.

Ready to see how a sector-tailored VKYC flow performs for your business?
Book a free demo with Pixl today

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