Lower-risk customers may get to breathe easy on KYC

The Centre is working on long-awaited changes to Know Your Customer (KYC) rules, simplifying the process for lower-risk customers and tightening checks on higher-risk accounts.

- Subhash Narayan & Rhik Kundu

NEW DELHI:

The government is preparing to amend the Prevention of Money Laundering Act (PMLA) to bring about such a risk-based KYC framework, two people aware of the development said. Currently, financial institutions mandate a uniform KYC process for their customers regardless of risk.

"The changes would align both Reserve Bank of India regulations and broader PMLA compliance norms, streamlining the KYC onboarding process and improving overall customer experience," one of the two people cited above said on the condition of anonymity.