KYC norms may be made simpler

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KYC norms may be made simpler
KYC or Know Your Customer guidelines are to be complied with in order to avoid the entry of any fake and fraudulent individuals in the system. For completing the KYC procedure, banks and other institutions generally demand two proofs; one, the proof of identification and the other address proof. While proof of ID is easy to produce, it is the address proof that makes the KYC procedure cumbersome. And, a change in address can be on account of several possible reason, an individual has to complete the KYC procedure all over again.

However considering the hassles and difficulty confronted by ordinary and genuine folks in complying with the KYC procedure, it is likely that norms in relation to Know Your Customer get simpler. In a recent report on Comprehensive Financial Services for Small Business and Low Income Household by the Reserve Bank of India, the apex financial institution of the country, the committee recommended the requirement of a genuine Proof of Identity (POI) from each of the customer. However, in respect of the address proof, the requirement of one national address proof with a waiver on producing proof of current address for opening a bank account was recommended.

The recommended move if implemented will benefit individuals with documentary proof of their permanent address. So, even in case of change of address, the individual will not require to comply with the KYC norms for banking purposes again and again.

Read more about: kyc, know your customer, banks
Story first published: Tuesday, January 14, 2014, 15:38 [IST]
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