Background: Para 1O1 of the Second Quarter Review of Monetary Policy 2012-13 announced on October 30’20l2, wherein it was proposed to view the existing KYC norms for simplifying the provisions of PML Act/Rules and international standards.
Reserve Bank of India, vide Notification No RBl12012-131322 DBOD.AM L.BC. No. 65 I 1 41.0’1.001 12012-13 dtDecember 10,2012 has informed the Banks as under:
Introduction not Mandatory for opening bank accounts – Before implementation of the system of document-based verification of identity’ as laid down in PML Act Rules, introduction from an existing customer of the bank was considered necessary for opening of bank accounts.
ln many banks, obtaining of introduction for opening of accounts is still a mandatory part of customer acceptance policy even though documents of identity and address as required under RBI instructions are provided.
This poses difficulties for prospective customers in opening accounts as they find it difficult to obtain introduction from an existing account holder.
RBI has clarified that since introduction is not necessary for opening of accounts under PML Act and Rules or Reserve Bank’s extant KYC instructions, banks should not insist on introduction for opening bank accounts of customers.