KYC Norms/Anti-Money Laundering Standards/Combating Financing of Terrorism/Obligation of Banks under PMLA, 2002 - e-KYC Service of UIDAI - Recognising on-line Aadhaar authentication (electronic verification process) to be accepted as an ‘Officially Valid Document’ under PML Rules - UCBs - RBI - Reserve Bank of India
KYC Norms/Anti-Money Laundering Standards/Combating Financing of Terrorism/Obligation of Banks under PMLA, 2002 - e-KYC Service of UIDAI - Recognising on-line Aadhaar authentication (electronic verification process) to be accepted as an ‘Officially Valid Document’ under PML Rules - UCBs
RBI/2013-14/263 September 17, 2013 The Chief Executive Officer Madam / Dear Sir, Know Your Customer (KYC) Norms /Anti-Money Laundering (AML) Standards/ Combating Financing of Terrorism (CFT)/Obligation of banks under Prevention of Money Laundering Act (PMLA), 2002 – e-KYC Service of UIDAI – Recognising on-line Aadhaar authentication (electronic verification process) to be accepted as an ‘Officially Valid Document’ under PML Rules – Primary (Urban) Cooperative Banks Please refer to paragraph 2.6 (B) of our Master Circular UBD.BPD. (PCB).MC.No.16 /12.05.001/2013-14 dated July 1, 2013 on Know Your Customer (KYC) Norms / Anti-Money Laundering (AML) Measures / Combating of Financing of Terrorism (CFT)/ Obligations of banks under PMLA, 2002 which states that letter issued by the Unique Identification Authority of India (UIDAI) containing details of name, address and Aadhaar number may be accepted as an ‘Officially Valid Document’. Further, in terms of paragraph 2.5 (ix) of the Master Circular, banks have been advised that while opening accounts based on Aadhaar, if the address provided by the account holder is the same as that on Aadhaar letter, it may be accepted as a proof of both identity and address. 2. In order to reduce the risk of identity fraud, document forgery and have paperless KYC verification, UIDAI has launched its e-KYC service. Accordingly, it has been decided to accept e-KYC service as a valid process for KYC verification under Prevention of Money Laundering (Maintenance of Records) Rules, 2005. Further, the information containing demographic details and photographs made available from UIDAI as a result of e-KYC process (“which is in an electronic form and accessible so as to be usable for a subsequent reference”) may be treated as an ‘Officially Valid Document’ under PML Rules. In this connection, it is advised that while using e-KYC service of UIDAI, the individual user has to authorize the UIDAI, by explicit consent, to release her or his identity/address through biometric authentication to the bank branches/business correspondents (BCs). The UIDAI then transfers the data of the individual comprising name, age, gender, and photograph of the individual, electronically to the bank/BCs, which may be accepted as a valid process for KYC verification. The broad operational instructions to banks on Aadhaar e-KYC service are enclosed as Annex. 3. UCBs are advised to have proper infrastructure (as specified in Annex) in place to enable biometric authentication for e-KYC. 4. Physical Aadhaar card/letter issued by UIDAI containing details of name, address and Aadhaar number received through post would continue to be accepted as an ‘Officially Valid Document’. 5. UCBs may revise their KYC policy in the light of the above instructions and ensure strict adherence to the same. Yours faithfully, (P.K. Arora) Operational Procedure to be followed by UCBs for e-KYC exercise The e-KYC service of the UIDAI is to be leveraged by UCBs through a secured network. Any UCB willing to use the UIDAI e-KYC service is required to sign an agreement with the UIDAI. The process flow to be followed is as follows: 1. Sign KYC User Agency (KUA) agreement with UIDAI to enable the UCB to specifically access e-KYC service. 2. UCBs to deploy hardware and software for deployment of e-KYC service across various delivery channels. These should be Standardisation Testing and Quality Certification (STQC) Institute, Department of Electronics & Information Technology, Government of India certified biometric scanners at bank branches/ micro ATMs/ BC points as per UIDAI standards. The current list of certified biometric scanners is given in the link below: 3. Develop a software application to enable the use of e-KYC across various Customer Service Points (CSP) (including bank branches, BCs etc.) as per UIDAI defined Application Programming Interface (API) protocols. For this purpose UCBs will have to develop their own software under the broad guidelines of UIDAI. Therefore, the software may differ from UCB to UCB. 4. Define a procedure for obtaining customer authorization to UIDAI for sharing e-KYC data with the UCB. This authorization can be in physical (by way of a written explicit consent authorising UIDAI to share his/her Aadhaar data with the UCB/BC for the purpose of opening bank account) /electronic form as defined by UIDAI from time to time. 5. Sample process flow would be as follows:
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