KYC norms eased for low-income group

The Reserve Bank of India (RBI) has relaxed know your customer (KYC) guidelines for low income group customers of banks.

The relaxations will apply to a customer who intends to keep balances not exceeding Rs 50,000 in all accounts and to avail of total credit in all the accounts not exceeding Rs 1,00,000 in a year.

The relaxation comes on the back of inability of many individuals belonging to low income group to produce identity and address proofs.

In case an individual, who wants to open an account, is unable to produce the necessary documents, he can be introduced by another account holder who has been subjected to the entire KYC procedure.

However, the introducer's account with the bank should be at least six month old and should show satisfactory transactions, RBI said.

Scheduled commercial banks and urban commercial banks have been told that low income group customers will have to undergo the full KYC procedures if aggregate balances and loans exceed the limits.