RBI/2018-19/190
DBR.AML.BC.No.39/14.01.001/2018-19
May
29, 2019
The Chairpersons/ CEOs of all
the Regulated Entities
Dear Sir/Madam,
Amendment to Master Direction
(MD) on KYC
Government of India, vide
Gazette Notification G.S.R. 108(E) dated February 13, 2019, has notified
amendments to the Prevention of Money-laundering (Maintenance of Records)
Rules, 2005. Further, an Ordinance, “Aadhaar and other Laws (amendment)
Ordinance, 2019”, has been notified by the Government amending, inter alia,
the Prevention of Money Laundering Act, 2002.
2. Important changes carried out
in the Master Direction in accordance with the aforementioned amendments
are listed hereunder:
a) Banks have been allowed to
carry out Aadhaar authentication/ offline-verification of an individual who
voluntarily uses his Aadhaar number for identification purpose. (Section 16
of the amended MD on KYC)
b) ‘Proof of possession of
Aadhaar number’ has been added to the list of Officially Valid Documents
(OVD) with a proviso that where the customer submits ‘Proof of possession
of Aadhaar number’ as OVD, he may submit it in such form as are issued by
the Unique Identification Authority of India (UIDAI). (Section 3 of the amended
MD)
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
(non-DBT beneficiaries) while submitting Aadhaar for Customer Due
Diligence, redact or blackout their Aadhaar number in terms of sub-rule 16
of Rule 9 of the amended PML Rules.(Section 16 of the amended MD)
e) REs other than banks may
identify a customer through offline verification under the Aadhaar Act with
his/her consent. (Section 16 of the amended MD)
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. (Section 3(a) ix
of the amended MD)
g) For non-individual customers,
PAN/Form No. 60 of the entity (for companies and Partnership firms – only
PAN) shall be obtained apart from other entity related documents. The
PAN/Form No. 60 of the authorised signatories shall also be
obtained.(Section 30-33)
h) 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 account shall be subject to
temporary ceasing till PAN or Form No. 60 is submitted. However, before
temporarily ceasing operations for an account RE shall give the customer an
accessible notice and a reasonable opportunity to be heard.(Section 39 of
the amended MD)
4. Further, additional
certifying authorities for certifying the OVDs of Non-Resident Indian (NRI)
and Person of Indian Origin (PIO) customers have been specified in section
3(a)(v) of the Master Direction.
5. The Master Direction on KYC dated February 25, 2016,
is hereby updated to reflect the changes effected by the above amendments
and shall come into force with immediate effect.
Yours faithfully,
(Dr. S. K. Kar)
Chief General Manager
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