RBI tweaks KYC norms for regulated entities


Business Line
May 29, 2019
RBI tweaks KYC norms for regulated entities

The Reserve Bank of India (RBI) has carried out important changes in its master direction on Know-Your-Customer (KYC) for regulated entities (REs), including allowing banks to carry out Aadhaar authentication/offline verification of an individual who voluntarily uses his Aadhaar number for identification purpose, and adding ‘proof of possession of Aadhaar number’ to the list of Officially Valid Documents (OVD).

Further, REs other than banks can identify a customer through offline verification under the Aadhaar Act with his/her consent.

Temporary ceasing
“For existing bank account holders, PAN or Form No 60 is to be submitted within such timelines as may be notified by the government, failing which the account shall be subject to temporary ceasing till PAN or Form No 60 is submitted.

“However, before temporarily ceasing operations for an account, the RE shall give the customer an accessible notice and a reasonable opportunity to be heard,” the RBI said.

The changes by the RBI come in the wake of the government notifying amendments to the Prevention of Money Laundering (Maintenance of Records) Rules, 2005, in February.

The central bank said ‘proof of possession of Aadhaar number’ has been added to the OVD list with a provision that when the customer submits this proof as OVD, he may submit it in such form as issued by the Unique Identification Authority of India (UIDAI).

For customer identification of individuals desirous of receiving any benefit or subsidy under any scheme notified under Section 7 of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, the bank should obtain the customer’s Aadhaar and carry out its e-KYC authentication based on his declaration that he is desirous of receiving benefit/subsidy under the Aadhaar Act, 2016.

Non-DBT beneficiaries
For customer identification of individuals, who are non-Direct Benefit Transfer beneficiary customers, the REs should obtain a certified copy of any OVD containing details of his identity and address along with one recent photograph.
Link-https://www.thehindubusinessline.com/money-and-banking/lakshmi-vilas-bank-aims-to-raise-700-1000-cr-in-fy20/article27296723.ece

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