KYC pains for NRIs and PIOs

Banks needs to computerise data of NRIs and PIOs, which will indicate, well in advance when the applicant's overseas passport expires; whether or not he holds any other valid documents, like driving license

 

A few months ago, the Reserve Bank of India (RBI) issued the know your customer (KYC) guidelines,  (DBOD.AML.BC No: 44/14.01.001/2014-15 dated 21 October 2014), which makes it mandatory for banks to periodically update its customer identity data.

 

This particular circular refers only to non-resident Indians (NRIs) and persons of Indian origin (PIOs), who may have also obtained the Overseas Citizen of India Card, after securing foreign nationality, and yet, has very close links back with India. This could be through their investments, or kith and kin living there and their own elderly parents living in India. Such a move to obtain the information and keep a track of such NRIs would be of national advantage, in the long run.

 

The requirement, as per this circular, is proof of one being an NRI or PIO and is given by providing a copy of the valid passport and visa, if holding an Indian passport; for a person of Indian origin, holding, a foreign passport, but holding an OCI card, copy of the same would be needed. However, the rules stipulate that these should be attested by the Indian Embassy or Consulate abroad, or a Notary Public, or any branch of an Indian scheduled commercial bank having an overseas branch in the country of residence of the applicant. To obtain this attestation, it is natural for the applicant to produce the original document for verification!

 

Additional proof of identity and address are also required by supporting documentary evidence. This would be for the NRI or OCI who has "returned" back to India, and is living in the country, on his/ her own, and/or with his/ her family.

 

In addition to the above, customer updation requires the current personal details, such as the address location, phone numbers, mobile phone numbers, email address, passport and visa details (if still holding the NRI status, but with the Indian passport etc.), Pan Card data, with a supporting passport photo.

 

The question is that the above needs must also ensure that the Banks are organised to computerise the data, which will indicate, well in advance when the applicant's overseas passport expires; whether or not he holds any other valid documents, such as the Drivers' license (both domestic and foreign, if any).  Many NRIs, who have residences back in India also have Voter's ID Cards, besides having PAN cards. All these need to be incorporated into the system, and the upgrading must be done at the Bank where the applicant operates. Instead of having to produce tonnes of attested documents, RBI must permit, and the Banks should accept, a self-certified statement if there are any changes, with an undertaking that the revised, renewed document, like the passport, will be provided should be enough, which should be actually given within an agreed time frame.

 

The NRIs/OCIs, in comparison to rest of the Indians at home, are a minority. It will be an enormous and Herculean task if the Banks are expected to obtain this sort of information from every single customer that they may have, for the rest of Indians!