RBI amends the Master Direction on KYC

Jun 06, 2019 | by Avantis RegTech Legal Research Team


The Reserve Bank of India (RBI) on May 29, 2019, has issued a Notification to make amendments in the Master Direction on Know Your Customers (KYC). The RBI had notified amendments to the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005 and further an Aadhaar and other Laws (amendment) Ordinance, 2019 had been notified by the Government amending the Prevention of Money Laundering Act, 2002. 

The important changes carried out in the Master Direction are:

a. Banks have been allowed to carry out Aadhaar authentication or offline-verification of an individual who voluntarily uses his Aadhaar number for identification purpose.

b. Proof of possession of Aadhaar number’ has been added to the list of Officially Valid Documents (OVD) 

c. For customer identification of “individuals”:

i. For individual 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 shall obtain the customers Aadhaar and may carry out its e-KYC authentication based on his declaration that he is desirous of receiving benefit/subsidy under the Aadhaar Act, 2016. (Section 16 of the amended MD)

ii. For non-DBT beneficiary customers, the Regulated Entities (REs) shall obtain a certified copy of any OVD containing details of his identity and address along with one recent photograph. (Section 16 of the amended MD)

d. REs shall ensure that the customers while submitting Aadhaar for Customer Due Diligence, redact or blackout their Aadhaar number in terms of Rule 9(16) of the amended PML Rules.

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

f. In case OVD furnished by the client does not contain updated address, certain deemed OVDs for the limited purpose of proof of address can be submitted provided that the OVD updated with current address is submitted within 3 months. 

g. For non-individual customers, PAN/Form No. 60 of the entity shall be obtained apart from other entity related documents. The PAN/Form No. 60 of the authorised signatories shall also be obtained.

h. Failing of submitting of PAN or Form No. 60, may result to temporary ceasing to existing bank account.

The Master Direction on KYC dated February 25, 2016, has also been updated.

[Notification No. DBR.AML.BC.No.39/14.01.001/2018-19]

Click here to download the Notification.

 


Bookmark

Related Updates



Alternate Text

Get updates on the go on RuleZbook Mobile App.