Remember there are different levels of assets that can be traded in your trading account and the levels and rigor of KYC is also different for these asset classes. For buying and selling purely equities, the KYC is a lot simpler. But if you want to trade in futures & options, then you need to furnish income proof and also convince the broker that you are in a position to handle the risk of F&O. This rigorous system has been designed to protect the interests of clients. Similarly, if you also want to trade in commodities, then there are additional levels of KYC that will be required. Normally the following assets can be bought and sold through your trading account with a broker:
Mutual Funds
Exchange Traded Funds
Company FDs
Gold Bonds
Debentures of companies
Commodity Futures
Currency Futures
Of course, commodity futures require a separate trading and demat account but all the other assets can be purchased and sold through a single account itself. It is possible to buy and sell all the above assets through a single comprehensive KYC. The pay-ins and the payouts in all these cases can also be seamlessly done through your existing Trading Account <-> Bank Account <-> Demat Account relationship.