5 hrs ago
RBI Eases FPI KYC Certification Rules Through Overseas Channels
The Reserve Bank of India changed a rule for foreign investors.
These investors can now have certain identity documents certified in the country where they live.
They do not always need to send the documents to India for certification.
Approved certifiers include some bank officials, notaries, judges, and Indian embassies.
Indian banks must still check the investors’ identities carefully.
The rule keeps the existing process for comparing copies with original documents.
Foreign investors have recently sold more Indian shares than they bought.
High oil prices and high US interest rates could affect whether they continue investing in India.
The Reserve Bank of India has eased KYC compliance procedures for foreign portfolio investors.
Indian banks may accept original certified copies of specified KYC documents certified by authorised officials overseas.
Recognised certifiers include overseas bank officials, foreign notaries, judges, court magistrates, and Indian diplomatic missions.
The amendment took effect immediately but retains banks’ responsibility to conduct KYC checks and verify documents against originals.
FPI outflows reached Rs 23,676 crore this month, with crude prices and US bond yields identified as key flow risks.
- Who
- The Reserve Bank of India, Indian banks, and foreign portfolio investors.
- What
- The RBI amended KYC directions to allow overseas certification of specified FPI documents.
- Where
- The certification may take place overseas before documents are submitted to Indian banks.
- When
- The amendment took effect immediately in 2026; FPI outflows were reported through Friday of the current month.
- Why
- To extend an existing certification facility to FPIs and simplify their compliance process while retaining KYC safeguards.
Key facts
- Amendment
- RBI (Commercial Banks–Know Your Customer) Amendment Directions, 2026
- Effective date
- Immediately
- Eligible investors
- Foreign portfolio investors
- Accepted certification channels
- Recognised overseas bank officials, foreign notaries, court magistrates, judges, Indian embassies, and consulates
- KYC requirement
- Banks must continue conducting KYC checks and comparing copies with originals
- Reported FPI outflows
- Rs 23,676 crore through exchange selling during the month up to Friday
- Market factors
- The article identifies the Iran-US conflict, crude prices, and US bond yields as influences on FPI flows
Sources
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