How to Relax / Simplify KYC Norms
However, for those customers who are unable to submit the above mentioned documents for valid reasons, branches may open their accounts, provided they intend to maintain balances not exceeding Rupees Fifty thousand (Rs.50,000/-) in all their accounts taken together, and the total credit summation in all the accounts, taken together is not expected to exceed Rupees One Lakh (Rs.1,00,000/-) in a year subject to:
(a) introduction from another account holder who, himself, has been subjected to full KYC Procedure, and whose account with the Bank should be at least six months old and show satisfactory transactions. The introducer must certify the photograph and local address of the prospective customer.
(b) any other evidence of the identity and address of the customer to the satisfaction of the Bank.
While opening such accounts, the customers should be made aware that if, at any point of time, the balances in their accounts with the Bank and the total credit in a year exceed the above threshold, no further transactions would be permitted, until the full KYC procedure is completed. The branches, therefore, must notify the customer when the balances reach Rupees Forty Thousand ( Rs. 40,000/- or the total credit in a year reaches Rupees Eighty Thousand (Rs. 80,000/-) and call for the requirements under full KYC procedure.
(This article in context of India)
Wherever branches desire to collect any information about the customer for a purpose other than KYC requirements, it should not form part of the account opening form. Such information may be collected separately, purely on a voluntary basis, after explaining the objectives to the customers and taking his express approval for the specific uses to which such information could be put. (refer H.O. Circular No.GB/2004-05/19 dated 18-06-2004.)
Branches should ensure that the application of KYC procedures to existing accounts has already been completed (as per H.O. Cir. No.GB/2004-05/30 dated 17-07-2004)
Obtain revised account opening form (H.O – 1015) completed in all respects to comply with KYC norms (refer H.O. Circular No.GB/2003-04/92 dated 16-02-2004.
- The same account opening form to be used for SB, CA, TD and other value added services.
- The Account opening form may be written with ink (except Red Ink), ball pen or may be type-written. It may be written or Hind/English or local language.
- Specimen signature of the customer be recorded in the presence of an authorised official.
- If nomination is obtained, enter the same in nomination register.
- Initial deposit will ordinarily be in cash.
- Flag in the system wherever applicable
- Care “Blind Depositor”
- Care “Illiterate Depositor”
- Care “Dumb & Deaf Depositor”
- Care “Depositor Handicapped”
- Care “Minor Depositor”
- Account number is generated by the system. Enter it in appropriate column of A/c opening form, Nomination form, Specimen signature card.
- Complete the headings from the account opening form and other connected forms. Enter cheques series issued in the system.
- When account is opened in joint names, indicate mode of operation “E or S” or “Jointly or severally” as the case may be.
- Issue pass book, incorporating all the particulars,.
- Carefully record/flag in the system any special instructions
- Photograph(s) of depositors be properly pasted on account opening form, pass book (not to be stapled) and signed on the face of photograph by an authorised official with his seal.
- Issue cheque book (except in case of an Ordinary Savings Bank account for which Withdrawal Forms are prescribed). Depositor cannot withdraw an amount less than Rs.50/-. A penalty of Rs.10/- will be charged in case of breach of the rule.
- Ensure that the account number on the account opening form is verified and signed by an authorised Officer before it is properly filed.
- All new accounts be flagged in the system to facilitate close monitoring of such accounts during the period of first six months for unusual transactions.
Monitoring of Transactions:
(a) Cash Transactions:
(i) All cash transactions (both deposits and withdrawals) of Rs.10.00 lac and above, in deposit, cash-credit and overdraft accounts should be recorded in a separate register and reported to the Controllers every month.
(ii) Traveller’s Cheques, Demand Drafts, Banker’s Cheques, Telegraphic Transfers for Rs.50,000/- and above should be issued / effected only by debit to customers’ accounts or against cheques but not against cash.
(iii) with reference to the above, all transactions of Rs.50,000/- and above would require PAN to be affixed by the applicant, or, in case PAN is not allotted, Form No.60/61 should be submitted.