SOUND MIND LEADS TO SAFE BANKING

KNOW YOUR CUSTOMERKNOW YOUR CUSTOMER

What is KYC?

“KYC (Know Your Customer) is a framework

for banks which enables them to know /

understand the customers and their financial

dealings to be able to serve them better.”

All banks have been advised by The Reserve Bank of India (RBI) to follow certain ‘KYC Guidelines’

Objectives of KYC

To enable the Bank to have positive identification of its relationship

Is in the interest of customers to safeguard their hard earned money

When does KYC apply?

KYC will be carried out at the following stages: Opening a new account In respect of accounts where documents as per current KYC

standards have not been submitted while opening the initial account

Opening a Locker Facility where these documents are not available with the Bank for all the Locker facility holders

When the Bank feels it necessary to obtain additional information from existing customers based on conduct of account

When there are changes to signatories, mandate holders, beneficial owners etc.

For non-account holders approaching the Bank for high value one-off transactions like Drafts, Remittances etc.

Proof needed from customers regarding KYC

RBI mandates three proofs to be collected from customers:

Photograph

Proof of identity

Proof of address

These are to be submitted by the customer both at the timeof opening of account as well as at the time of change ofaddress.

Small deposit accounts are those accounts where,

Balance does not exceed Rs. 50,000/- and

Annual turnover does not exceed Rs. 1,00,000/-

Simplified KYC norms prescribed for Small Deposit accounts

Customers can open this type of accounts by getting introduced by existing fully KYC compliant account as also attestation of address / photograph by him.

Small Deposit Accounts

Contact point for customers in the Bank will be the

Relationship Manager / official who opens the account and

is the contact person during transactions

Contact Point in Banks for KYC

MONEY LAUNDERINGMONEY LAUNDERING

What is Money Laundering?

Money laundering refers to the conversion of money

illegally obtained to make it appear as if it originated from

a legitimate source.

It is being employed by launderers worldwide to conceal

proceeds of criminal activity associated with it, such as

drugs / arms trafficking, terrorism and extortion.

Effect on Customers

For prevention of opening of accounts in false identities, Banks have to ask for proof of customer’s identity and address during opening of new accounts

Being asked for these documents does not imply that the customers are suspected of money laundering

It is a necessity to identify all prospective account holders or customers as anybody including a criminal could falsely use another customer’s identity, if the respective documents are not obtained.

What proof of identity will you need?

Best identification documents are those issued by a Government authority, having a photograph, address and signature

One document can be used to establish both identity and address, else two or more documents will suffice

Some proofs of Identity & Address for Individuals: Passport Election ID card Driving License Voter ID card

Proofs of Identity & Address for companies, Trusts, Firms:Partnership DeedTrust DeedMemorandum & Articles of

AssociationCertificate of Incorporation etc.

What proof of identity will you need? (Contd.)

Documents used for Identity only for individuals:

Documents used for Address only for individuals :

Pan card ID card of reputed employers

Salary SlipElectricity BillTelephone BillRation Card

Mandates banks to report certain transactions to the nominating agency under instructions issued by RBI in consultation with the Indian Government and Indian Bank’s Association

It specifies that, Demand drafts, mail transfers and travelers cheques for Rs.

50,000/- and above can be issued only by debit to customer’s account or cheque etc, and not against cash payment

Demand drafts, mail transfers and travelers cheques for Rs. 50,000/- and above can be paid by banks only by credit to customer’s account or through other banking channels and not cash

Prevention of Money Laundering Act (PMLA) 2002

Help us to Help You

By being patient when a Bank staff asks you to provide documents to prove your identity / address

By maintaining confidentiality of your account details and identity documents

For any further queries, please contact

1800112211 (tollfree from BSNL/MTNL) or 080-26599990.