Bangladesh Bank is set to introduce the electronic Know Your Customer (e-KYC) system under which bank accounts can be opened without filling in any paper-based documents.

Those with e-KYC will be allowed to operate limited-scale transaction through the agent banking network and mobile financial services, in a development that is set to boost the country's financial inclusion cause.

“The new system will help the unbanked and underprivileged people enjoy banking services,” said Md Anwarul Islam, assistant spokesperson of the BB.

The central bank will try to complete all process to introduce e-KYC, which has been in the works for the last two years, within June.

The customers will also be able to put in money in deposit pension schemes and the government savings certificates. The regular KYC required filling up forms along with photo and supporting documents.

For e-KYC, however, is a digital process where service provider can open a customer account by filling up a digital form, taking photograph on the spot, and authenticate the customer's identification data instantly. The thumb print would serve as the digital signature.

Banks are now allowed to verify the national identity card of their clients through using the NID data base, Islam said. The central bank has already framed a draft design to extend banking services through the e-KYC, another BB official said.

Customers with e-KYC can transact up to Tk 20,000 per month through the mobile financial service platform and Tk 1 lakh through agent banking. 

They can also invest in savings certificates and other government securities worth Tk 5 lakh.

The banks can disburse Tk 2 lakh in SME loans to an e-KYC account holder.

The e-KYC will eventually eliminate the need for hard copy document management, said the BB official.

“It will reduce the risk of identity fraud,” he said.

The service will completely be automated and the e-KYC data will be furnished in real-time, without any manual intervention.

Digitally signed e-KYC data will be machine readable, meaning the service provider can directly store it as customer record in their database for purpose of service and audit etc.