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The Reserve Bank of India (RBI) on Friday extended the applicability of centralized know your customer (KYC) registry to legal entities, from individual accounts, effective 1 April 2021.

Banks, non-banks, and other entities regulated by RBI have been uploading the KYC data pertaining to all individual accounts opened on or after 1 January 2017 on to the centralized KYC registry (CKYCR).

The objective of KYC is to prevent banks from being used by criminal elements for money laundering or terrorist financing activities. KYC procedures also enable banks to understand their customers and their financial dealings better, which in turn help them manage risks prudently.

RBI said on Friday that as the central registry is fully-operational for individual customers, it has been decided to extend it to legal entities (LEs).

“Regulated entities shall upload the KYC data pertaining to accounts of LEs opened on or after 1 April 2021, on to CKYCR in terms of Rule 9 (1A) of the PML Rules," it said.

Regulated entities shall also ensure in case of accounts of LEs opened prior to 1 April, the KYC records are uploaded on to CKYCR during periodic updation as specified in Section 38 of the master direction, or earlier when the updated KYC information is obtained from the customer. “To ensure all existing records are uploaded on to CKYCR, regulated entities shall upload the KYC data pertaining to accounts of individuals opened prior to 1 January, 2017, at the time of updation," it added.

ABOUT THE AUTHOR

Shayan Ghosh

Shayan Ghosh is a national writer at Mint reporting on traditional banks and shadow banks. He has over a decade of experience in financial journalism. Based in Mint’s Mumbai bureau since 2018, he tracks interest rate movements and its impact on companies and the broader economy. His interests also include the distressed debt market, especially as India’s bankruptcy law attempts recoveries of billions worth of toxic assets.
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