RBI Governor Shaktikanta Das extends video KYC to proprietorship firms, authorised signatories and more

RBI Governor Shaktikanta Das (file image)

The Reserve Bank of India (RBI) has announced rationalisation of the know your customer (KYC) compliance norms on May 5 as Governor Shaktikanta Das announced a string of measures to shore up financial institutions with the second coronavirus wave threatening economic recovery.

In an unscheduled speech, Governor Shaktikanta Das said, "Taking forward the initiatives of the Reserve Bank for enhancing customer convenience, it has been decided to rationalise certain components of the extant KYC norms."

It includes the extension of the scope of video KYC, known as the video-based customer Identification process (V-CIP) for new categories of customers such as proprietorship firms, authorised signatories and beneficial owners of Legal Entities and for periodic updation of KYC.

The bank has also decided the conversion of limited KYC accounts opened on the basis of Aadhaar e-KYC authentication in non-face-to-face mode to fully KYC-compliant accounts, he said.

The use of KYC Identifier of Centralised KYC Registry (CKYCR) for V-CIP and submission of electronic documents, including identity documents issued through DigiLocker, proof of identity will also be enabled now.

The RBI governor also announced the introduction of more customer-friendly 10 options, including the use of digital channels for updating KYC details.

No punitive restriction on operations of customer accounts will be imposed till December 31, 2021 if where periodic KYC updating is due or pending, RBI has told regulated entities unless warranted due to any other reason or under instructions of any regulator/enforcement agency/court of law, etc.

Account-holders should update their KYC during the period, Das added.

Follow LIVE updates of the RBI Governor’s unscheduled address here