SOUND MIND LEADS TO SAFE BANKING

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SOUND MIND LEADS TO SAFE BANKING
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KNOW YOUR CUSTOMER
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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

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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

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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.

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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 time
• of opening of account as well as at the time of
  change of
• address.

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Small Deposit Accounts

• 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.

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Contact Point in Banks for KYC

• Contact point for customers in the Bank will be
  the Relationship Manager / official who opens the
  account and is the contact person during
  transactions

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MONEY LAUNDERING
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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.

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Effect on Customers

• For prevention of opening of accounts in false
  identities, Banks have to ask for proof of
  customers 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 customers
  identity, if the respective documents are not
  obtained.

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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

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What proof of identity will you need? (Contd.)
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Prevention of Money Laundering Act (PMLA) 2002

• Mandates banks to report certain transactions to
  the nominating agency under instructions issued
  by RBI in consultation with the Indian Government
  and Indian Banks Association
• It specifies that,
• Demand drafts, mail transfers and travelers
  cheques for Rs. 50,000/- and above can be issued
  only by debit to customers 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 customers account or
  through other banking channels and not cash

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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.
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THANK YOU