The Reserve Bank of India (RBI) has extended the relaxation it provided for operation of customer accounts of regulated entities where periodic updation of KYC (know your customer) is due and pending as on date, from December 31, 2021, till March 31, 2022.

This is in view of the prevalent uncertainty due to new variant of Covid-19.

RBI said no restrictions on operations of such accounts shall be imposed till March 31, 2022, for the aforementioned reason alone, unless warranted under instructions of any regulator/enforcement agency/court of law, etc.

“Regulated Entities” (REs) include all banks, all India financial institutions, all non-banking finance companies, miscellaneous non-banking companies and residuary non-banking companies, all payment system providers/system participants and prepaid payment instrument issuers, and all authorised persons including those who are agents of money transfer service scheme, regulated by the regulator.

KYC policy

REs’ KYC policy includes four key elements – customer acceptance policy, risk management, customer identification procedures, and monitoring of transactions.

As part of customer due diligence (CDD) procedure in the case of individuals, REs shall obtain Aadhaar number; permanent account number or the equivalent e-document thereof or Form No. 60 as defined in Income-tax rules, 1962; and such other documents including in respect of the nature of business and financial status of the customer, or the equivalent e-documents thereof as may be required by them.

Published on December 30, 2021