India Mandates Geolocation and Selfie Verification for Crypto Service Providers

India's Financial Intelligence Unit (FIU-IND) has implemented stringent new requirements for cryptocurrency service providers operating in the country. The updated guidelines, published in January 2026, aim to combat fraud, money laundering, and terrorism financing through enhanced customer verification protocols.

Key Compliance Requirements

1. Expanded Customer Due Diligence: Crypto platforms (Registered Entities or REs) must collect:
   • Government-issued identity documents
   • Bank account information
   • Occupation details
   • Annual income range
2. Geolocation Verification: REs must capture:
   • Latitude/longitude coordinates of onboarding location
   • Exact date and timestamp
   • User's IP address
3. Biometric Verification: A live selfie must be captured during onboarding to verify customer authenticity and liveness. This requirement extends to periodic re-verification.

Transaction Monitoring Obligations

REs must implement continuous monitoring systems for all transaction types:

• Fiat-to-fiat
• Virtual-to-virtual
• Fiat-to-virtual
• Virtual-to-fiat

Platforms must file suspicious activity reports immediately upon detecting transactions potentially involving:

• Proceeds of crime
• Terrorist financing
• Money laundering Reports must include comprehensive details about all transaction parties.

Compliance Timeline

• Effective Immediately: New customer onboarding must follow these protocols
• Retroactive Application: Existing customers subject to periodic reviews
• Global Reach: Offshore platforms serving Indian residents must comply

Regulatory Context

India hosts the world's largest population of cryptocurrency investors. These requirements align with conventional financial institution regulations but impose unique digital verification burdens. Foreign crypto platforms must now register with FIU-IND, disclose business locations, and name key officers.

The regulations acknowledge the "anonymous and instantaneous nature" of virtual asset transactions that enable illicit activities. While similar to India's previous attempts to regulate technology platforms, this framework represents a more targeted approach to balancing financial innovation with security concerns.

Non-compliant entities face enforcement actions under India's Prevention of Money Laundering Act. Crypto platforms should immediately update their KYC systems to incorporate geolocation capture, live selfie verification, and enhanced transaction monitoring capabilities.