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KYC Update: RBI has taken a big step towards making the KYC process easier and convenient for customers. Now banks will inform customers on time and technical and local cooperation will be resorted to to activate the passive accounts again.
KYC UPDATE: The Reserve Bank of India (RBI) has proposed a big change in the ‘Know Your Customer (KYC)’ rules to provide better service to customers and prevent matters like money laundering. In the draft circular issued on Friday, RBI has said to solve the troubles coming about KYC updates and dormant accounts. Millions of customers and beneficiaries of government schemes are expected to get relief from this change. Let me tell you, by 6 June 2025, all sides can give their suggestions on these new proposals.
KYC will have to update now even more simple
The RBI has admitted that in many cases customers are facing trouble in many cases regarding KYC updates, especially accounts which have been opened under government schemes such as DBT, EBT or Jan Dhan. According to the new proposal, the digital and customer-focused procedure for KYC updates will be given priority so that customers do not have to visit the bank branches repeatedly.
Banks will have to give advance notice to customers
Now it has been made mandatory for banks to give advance information about the need of KYC updates to their customers at least three times. Its purpose is to give customers a chance to update KYC in time and to protect against any kind of obstruction in banking services.
Facility to re -activate inactive accounts
The Reserve Bank has said that the help of business correspondents can be taken to re -activate the accounts which have become in -operative. Apart from this, banks who have facilities for video customer identification process (V-CIP) will provide this service on the demand of customers.
Compulsory KYC facility in all branches
The RBI has directed that it will be mandatory to provide KYC update facility in all bank branches, especially for accounts in which there has been no transaction without claims or long -term transactions. This will also provide facilities to customers in rural and remote areas.
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