RBI Poised to Simplify KYC Process with Business Correspondents
The Reserve Bank of India plans to utilize business correspondents for KYC updates, tackling complaints regarding inoperative accounts and simplifying updates. A draft circular proposes measures such as organizing camps to focus on KYC updation in underserved areas. Public feedback is invited by June 6.
- Country:
- India
The Reserve Bank of India (RBI) is considering innovative strategies to address the numerous complaints surrounding the know-your-customer (KYC) process. On Friday, the central bank announced potential plans to harness the extensive network of business correspondents (BCs) to streamline KYC updates and tackle the issue of inoperative accounts.
In a draft circular released, the RBI noted significant delays in periodic KYC updates, particularly in accounts opened under government schemes. These accounts, often set up for credit of Direct Benefit Transfers (DBT) or Electronic Benefit Transfers (EBT), frequently encounter obstacles, as highlighted by customer feedback.
In response, the RBI has proposed allowing authorised BCs to facilitate KYC processes, providing ease for customers. The bank also plans to urge financial institutions to launch KYC-focused campaigns, targeting rural and semi-urban branches. Feedback from the public on these proposals is welcomed until June 6.
(With inputs from agencies.)
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