The reserve bank of india (RBI) has asked banks and other regulated entities to present due notices to their customers for periodic updating of 'Know Your Customer' (KYC) so that it will enhance consumer safety as well as carrier.
In a round, the RBI stated it has located a massive pendency in periodic updating of KYC, along with the bills opened for credit of direct benefit transfer (DBT)/digital advantage switch (EBT) beneath authorities' schemes to facilitate credit scores of dbts and/or scholarship quantity (DBT/EBT/scholarship beneficiaries) and bills opened below Pradhan Mantri Jan Dhan Yojana.
With a view to further ease the method for the benefit of customers, the commands concerning updation/ periodic updation of KYC have been amended with the cause, inter alia, to permit bcs to facilitate inside the technique of KYC updation.
In this regard, it issued the Reserve Financial Institution of india Understand Your Patron (KYC) (Amendment) Guidelines, 2025, on Thursday.
Consistent with today's instructions, the regulated entity (RE) shall intimate to its clients, in advance, to update their KYC, it stated.
"Previous to the due date of periodic updation of KYC, the RE shall provide as a minimum three enhanced intimations, which include at least one intimation by using a letter, at appropriate durations to its clients through available communiqué alternatives/channels for complying with the requirement of periodic updation of KYC," it stated.
Next to the due date, the RE shall give at least 3 reminders, consisting of, at a minimum, one reminder by using a letter at appropriate periods to such clients who've still now not complied with the requirements, despite previou intimations.
RBI, in addition, said that the letter of intimation/reminder might also, inter alia, contain easy-to-apprehend commands for updating KYC, escalation mechanisms for seeking help if required, and the consequences, if any, of failure to replace their KYC in time.
"The difficulty of such improved intimation/reminder will be duly recorded inside the RE's gadget against every client for audit path," the Reserve financial institution stated and asked res to expeditiously enforce the same but not later than january 01, 2026.
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It additionally stated that a self-declaration from the client in case of no exchange in KYC records or trade simplest in the deal with info can be acquired through an accredited business Correspondent (BC) of the bank.
"The financial institution shall allow its bc structures for recording these self-declarations and helping files thereof in wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital shape within the bank's systems," it stated.
The RBI said that during recognition of a male or female client who's labeled as low threat, the RE shall permit all transactions and make sure the updation of KYC within twelve months of its falling due for KYC or as much as june 30, 2026, whichever is later.
Similarly, the RBI advised banks to organize camps and launch extensive campaigns that include unique camps that specialize in periodic updating of KYC, especially in rural and semi-urban branches and the branches having huge pendency in periodic updating of KYC.
"The banks may also facilitate the method of activation of such accounts by taking an empathetic view," it stated.
The RBI has additionally made amendments related to inoperative money owed and unclaimed deposits.
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