KYC norms for small accounts relaxed
Updated: Jul 26, 2013 06:12:00pm
New Delhi, July 26 (KNN) The Reserve Bank of India (RBI) has relaxed and simplified norms for opening small bank accounts with balance not exceeding Rs 50, 000 and aggregate credits upto Rs one lakh a year.
“Know your customer (KYC) requirements for opening bank accounts have been relaxed and simplified, especially for small accounts with balances not exceeding Rs. 50,000 and aggregate credits in the accounts not exceeding Rs one lakh a year,” said the executive director of RBI, Deepali Pant Joshi at a National Seminar on Consumer Protection here.
Further, RBI has now allowed banks to use Aadhaar card as a proof of both identity and address and the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) job card as an officially valid document for opening of bank accounts.
In addition to this, it has advised banks not to insist on introduction for opening bank accounts of customers, Joshi said at a recent Assocham event.
Meanwhile, in the annual policy statement for 2013-14, banks have been advised to consider prioritizing the opening of branches in unbanked rural centres over a three year cycle co-terminus with their financial inclusion plans (FIPs). This is expected to facilitate faster branch expansion in unbanked rural centres.
Further, to step up the opening of branches in rural areas so as to improve banking penetration and financial inclusion rapidly, the need for opening of more brick and mortar branches was felt.
Moreover, a study done by RBI suggests that there is one per cent increase in the number of banks in rural locations which has reduced rural poverty by 0.36 per cent and increased total output by 0.55 per cent.
Expansion of rural branches has increased output from non-primary sector and non-agricultural employment. These favourable effects show the positive influence of bank branches on economic development, she said. (KNN/GUNJ)
“Know your customer (KYC) requirements for opening bank accounts have been relaxed and simplified, especially for small accounts with balances not exceeding Rs. 50,000 and aggregate credits in the accounts not exceeding Rs one lakh a year,” said the executive director of RBI, Deepali Pant Joshi at a National Seminar on Consumer Protection here.
Further, RBI has now allowed banks to use Aadhaar card as a proof of both identity and address and the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) job card as an officially valid document for opening of bank accounts.
In addition to this, it has advised banks not to insist on introduction for opening bank accounts of customers, Joshi said at a recent Assocham event.
Meanwhile, in the annual policy statement for 2013-14, banks have been advised to consider prioritizing the opening of branches in unbanked rural centres over a three year cycle co-terminus with their financial inclusion plans (FIPs). This is expected to facilitate faster branch expansion in unbanked rural centres.
Further, to step up the opening of branches in rural areas so as to improve banking penetration and financial inclusion rapidly, the need for opening of more brick and mortar branches was felt.
Moreover, a study done by RBI suggests that there is one per cent increase in the number of banks in rural locations which has reduced rural poverty by 0.36 per cent and increased total output by 0.55 per cent.
Expansion of rural branches has increased output from non-primary sector and non-agricultural employment. These favourable effects show the positive influence of bank branches on economic development, she said. (KNN/GUNJ)
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