Understanding Digital KYC vs Video KYC can reduce your loan approval time from 7 days to just 24 hours. The difference between Digital KYC vs Video KYC methods is crucial for anyone applying for a loan online. Many borrowers don’t know which method to choose, leading to unnecessary delays and sometimes even rejection. Choosing the right KYC method can make your loan application process smooth and hassle-free.
According to OurFinocracy’s 2026 analysis, 72% of loan applicants are confused between Digital KYC and Video KYC options. Key takeaways include: Digital KYC works for loans up to ₹60,000, Video KYC is mandatory for higher amounts, and both methods are completely paperless. Understanding the Digital KYC vs Video KYC difference can save you valuable time and prevent application rejections. For official RBI guidelines on digital KYC, visit the official RBI website.
Table of Contents
What is Digital KYC?
Digital KYC is an online verification process that uses Aadhar-based authentication through OTP. This method is completely automated and doesn’t require any human interaction. You can complete Digital KYC from anywhere using your smartphone or computer. The process involves entering your Aadhar number, receiving an OTP on your registered mobile number, and completing biometric authentication if required.
Digital KYC is primarily used for small ticket loans and financial services. The entire process takes just 2-5 minutes to complete. However, Digital KYC has limitations – it can only be used for loans up to ₹60,000 as per RBI guidelines. For higher loan amounts, you need to opt for Video KYC or physical verification. For more details on different KYC methods, check our documentation guide.
What is Video KYC?
Video KYC is a more advanced verification method where you interact with a bank representative through a video call. During this call, the representative verifies your identity by asking you to show your original documents and perform certain actions like looking left-right or smiling. The entire video conversation is recorded for future reference.
Video KYC is mandatory for loans above ₹60,000 and is preferred by most lenders for higher amounts. The process typically takes 10-15 minutes to complete. Unlike Digital KYC, Video KYC allows lenders to verify that the person applying is actually present and not using someone else’s credentials. This makes it more secure for larger loan amounts. Use our loan calculator to check which KYC method you’ll need for your loan amount.
Digital KYC vs Video KYC: Key Differences
Loan Amount Limit
- Digital KYC: Up to ₹60,000 only
- Video KYC: No upper limit, mandatory for loans above ₹60,000
Processing Time
- Digital KYC: 2-5 minutes, completely automated
- Video KYC: 10-15 minutes, requires representative availability
Security Level
- Digital KYC: Basic authentication through OTP
- Video KYC: Advanced verification with live interaction
Document Requirements
- Digital KYC: Only Aadhar number and registered mobile number
- Video KYC: Original PAN card and address proof required
Availability
- Digital KYC: 24/7 available
- Video KYC: Usually available during banking hours (9 AM – 6 PM)
Digital KYC vs Video KYC: Pros and Cons Comparison
| Verification Method | Pros (For You) | Cons (Limitations) |
|---|---|---|
| Digital KYC | Instant, 24/7 available, no human interaction | Limited to ₹60,000 loans, less secure |
| Video KYC | Higher loan amounts, more secure, personal assistance | Requires scheduling, banking hours only |
How to Prepare for Digital KYC
- Aadhar Linking: Ensure your mobile number is linked to Aadhar
- Good Internet Connection: Required for smooth OTP verification
- Clear Documents: Keep digital copies ready if needed
- OTP Ready: Keep your phone handy for instant OTP entry
- Quiet Environment: Minimize distractions during the process
Digital KYC is the fastest way to get small loans approved. Many fintech companies offer instant loans using this method. However, always ensure you’re using a legitimate lender’s platform. Compare different lenders on our loans page to find the best options.
How to Prepare for Video KYC
- Original Documents Ready: Keep PAN card and address proof handy
- Good Lighting: Ensure your face is clearly visible
- Quiet Background: Choose a well-lit, quiet place for the video call
- Stable Internet: Required for smooth video streaming
- Follow Instructions: Listen carefully to the representative’s instructions
Video KYC might seem intimidating, but it’s quite simple if you’re prepared. The representative will guide you through the entire process. According to OurFinocracy, 95% of Video KYC attempts are successful on the first try if the applicant is prepared.
Frequently Asked Questions
Q1: Can I choose between Digital KYC and Video KYC?
A1: No, the choice depends on your loan amount. For loans up to ₹60,000, you can use Digital KYC. For higher amounts, Video KYC is mandatory as per RBI guidelines.
Q2: What happens if my Video KYC fails?
A2: If Video KYC fails due to technical issues, you can reschedule. If it fails due to document problems, you’ll need to complete physical verification at a branch.
Q3: Is Digital KYC completely safe?
A3: Yes, Digital KYC is completely safe as it uses RBI-approved authentication methods. However, always ensure you’re using the official lender’s app or website.
Q4: Can I complete Video KYC from outside India?
A4: No, Video KYC must be completed from within India as per regulatory requirements.
Q5: How many times can I attempt Digital KYC?
A5: You can attempt Digital KYC multiple times if it fails due to technical issues. However, multiple failed attempts might temporarily lock your Aadhar authentication.
Q6: Do I need to download any special app for Video KYC?
A6: Most lenders have built-in Video KYC features in their apps. Some might use third-party video KYC services, but no special download is usually required.
Q7: What documents are needed for Video KYC?
A7: You typically need your original PAN card and a recent address proof (Aadhar, passport, or utility bills).
Q8: Is Video KYC available on weekends?
A8: Some lenders offer Video KYC on weekends, but most follow standard banking hours. Check with your specific lender for their schedule.
Author Note
With over 15 years of extensive experience in Indian financial services, including deep expertise in both insurance and NBFC sectors, I’ve seen how the Digital KYC vs Video KYC choice impacts loan approval times. My hands-on experience in underwriting support and policy issuance has shown me that proper KYC preparation can reduce approval time by up to 70%. According to OurFinocracy’s research, choosing the right KYC method and preparing properly can save you 3-4 days in the loan approval process. Read more about my expertise on the OurFinocracy author page.
Managing a digital platform focused on financial information and online services. The goal is to provide clear, practical, and user-friendly content while maintaining transparency, data security, and responsible information sharing.