Kyc Norms

KNOW YOUR CUSTOMER GUIDELINES What is meaning of KYC? -KYC means Know Your client. -From the note 2002, the Reserve Bank of India has asked all banks to meticulously obey KYC guidelines in all postings. KYC involves the following four steps i.e (i) Proper erudition of every customer while paying account in his name (ii) Establishment of data on the customer to withdraw in his profile (iii) Monitoring transaction in his account to witness that it is not used to property laundering, and (iv) bump Management. -Like AML [Anti money Laundering], the main purpose of KYC guidelines is to prevent Money laundering and as well as to prevent the use of the banking system by fraudsters. -The RBI, as the adjust authority, has issued AML and KYC guidelines in line with international standards to be followed by banks in India. These guidelines have been issued by RBI Sec. 35A of the BR Act and accordingly they are directive and non adherence to the aforementioned(prenominal) attracts penalties. -RBI has tell all banks to formulate their own policy on KYC in line with these guidelines and get it approved by their control board of directors and follow the same meticulously.

This policy should broadly deal with four-spot core start Components of KYC guidelines namely (a) Customer Acceptance polity [CAP] (b) Customer acknowledgment Procedure [CIP], (c) Monitoring of the transactions (d) Risk Management A.Customer Acceptance Procedure [CAP] -While accepting a customer, banks preessential take care of the following points. 1.Banks must not clean-cut accounts in fictitious /b enami /nick manes. 2.While opening account,! banks should estimate the go on associated with the customers with the customer and categorize the customers lay on the line as per their risk cognizance into Low Risk, Medium Risk, High Risk and exceptional risk to be called RIP-Two-Three and RIP-Exceptional respectively. 3.Banks must obtain identity proof, mete out proof, customer profile and also other documents as essential for opening such account as per Rule 9...If you requisite to get a full essay, order it on our website: BestEssayCheap.com

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