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RBI: No a/c freeze till December for want of KYC


MUMBAI: Reserve Bank of India (RBI) on Monday reiterated that until December 2021, banks cannot freeze accounts if the client has not made a KYC (know your customer) update. The central bank said this while warning the public not to fall prey to fraudulent messages seeking bank details for KYC update purposes.
The RBI said it has been receiving complaints / reports about customers who are victims of fraud committed in the name of the KYC update. The RBI asked the public not to share key information such as account details or passwords with unidentified individuals or agencies under threat of account freezing.
Many customers have avoided visiting branches during the pandemic, giving scammers the opportunity to use KYC as a reason to interact with customers.
“The usual modus operandi in such cases includes receiving unsolicited communications, such as calls, SMS, emails that urge you to share certain personal data, account / login data / card information, PIN, OTP, etc. or install some unauthorized / unverified app for KYC update using a link provided in the communication, ”he said.
The RBI also said that it has greatly simplified the KYC update process. Instructions on the streamlined process come from banks asking customers to fill out multiple sheets of all-in-one documents simply to get regular proof of address and identity.
The central bank said Monday that NBFCs and payment system operators seeking to obtain the Aadhaar e-KYC authentication license can apply with the RBI.
In May 2019, the Ministry of Finance presented a detailed procedure for the processing of requests (under the PML Law) for the use of Aadhaar authentication services by entities other than banking companies.
“Consequently, non-bank financial companies (NBFCs), payment system providers and payment system participants who wish to obtain the Aadhaar authentication license: KYC User Agency License (KUA) or Sub-license. KUA (to authenticate through a KUA), issued by the UIDAI, you can send your request to this department for subsequent submission to the UIDAI, ”the RBI said in a circular. The RBI has also provided the application form.

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