RBI Reserve Bank of India in 2002
The Reserve Bank of India introduced Know Your Customer or KYC guidelines for all banks in 2002. In 2004, RBI directed all banks to ensure that they are fully compliant with the KYC provisions before December 31, 2005.
What is KYC?
Know Your Customer - KYC enables banks to know/ understand their customers and their financial dealings to be able to serve them better and manage its risks prudently.
Following Information may be helpful -
When does KYC apply?
Opening a new account Opening a subsequent account where documents as per current KYC standards 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 the account When there are changes to signatories, mandate holders, beneficial owners etc
KYC will also be carried out in respect of non-account holders approaching the bank for high value one-off transactions.
What will happen if I do not provide the required KYC information / documents to the Bank?
The Bank will be entitled to refuse to open the account (if you are a prospective customer) or discontinue its relationship with you citing non-providing of KYC information / documents (if you are an existing customer).
