KYC

1. KYC - Rights and responsibilities of Customers and the Company
2. Customers:

• Required to submit an officially valid document (OVD) for proof of identity and proof of address and a recent photograph, while availing the loan. In addition to this, the e-KYC service of Unique Identification Authority of India (UIDAI) is also accepted as a valid process for KYC verification.
• Customer also has to provide information about the nature of business activity undertaken by him, location of customer and his clients, mode of payments, volume of turnover, social and financial status etc. to enable Company to decide risk profile.
• When a customer does not possess any of the OVDs with current address following alternative documents to be collected
• utility bill which is not more than two months old of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill);
• property or Municipal tax receipt (not applicable for Delhi);
• pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address;
• Letter of allotment of accommodation from employer issued by State Government or Central Government Departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies and leave and license agreements with such employers allotting official accommodation;

However, customer will be required to provide updated OVD with current address within three months.

• If any of the OVDs submitted does not have the address details (either current or permanent) of the customer, then another OVD for proof of address has to be submitted.
• If an existing KYC compliant customer desires to take another loan, there should be no need for submission of fresh proof of identity and/or proof of address for the purpose.
• If the address of the customer mentioned as per ‘proof of address’ undergoes a change, fresh proof of address shall be submitted to the branch.
• OVD with the current address is not necessary if the customer submits an OVD with permanent address. In such cases, however, the customer has to submit a declaration about his current address which the Company have to verify independently and submit the updated OVD within three months.
• Existing customers are required to submit KYC documents for periodic updation of KYC. The periodicity of KYC updation is 2/8/10 years basis their risk categorization into high/medium/low risk customers.
• Company need not seek fresh proofs of identity and address at the time of periodic updation, from those customers who are categorized as ‘low risk’, in case of no change in status with respect to their identities and addresses. A self-certification by the customer to that effect should suffice in such cases. In case of change of address of such ‘low risk’ customers, they could merely forward a certified copy of the document (proof of address) by mail/post, etc. Company may not insist on physical presence of such low risk customer at the time of periodic updation.
• Company may deny extension/release of pending disbursement payment of the loan facility for non-compliance of KYC.

PAN Card or Form 60 is mandatory document in addition to the KYC document provided by the customer.

1. Company

Apart from the rights and responsibilities listed above, Company has the following responsibilities also as per KYC/AML/CFT requirements:

• To ensure that no account is opened in fictitious/non-existent name.
• Identify the beneficial owners of customer accounts, wherever required.
• Rating the customers as per the risk perception into low, medium and high risk.
• Regular monitoring of accounts to check whether there is any unusual/abnormal/suspicious transactions.
• File Cash Transaction Reports (CTR) and Suspicious Transaction Reports (STRs) with FIU-IND.
• To nominate a Designated Director and appoint Principal Officer as required in terms of PML Act and Rules.
• Take into account the list of individuals and entities notified under UNSC Resolutions so that no fresh loan facility extended in their names and existing accounts in such names are reported to the Government.

 

 

1. CHECK LISTS - for KYC processes to be followed by different customers and for different activities, based on customer profiling.

For Individuals – OVD Documents

• Passport
• Driving License
• Voters Identity card issued by the Election Commission of India
• Job Card issued by NREGA duly signed by an officer of the State Government,
• Letter issued by the National Population Register containing details of name and address.
• Aadhaar (optional for Non PMAY customers)

 

Legal Entities

For opening an account of a company, one certified copy of each of the following documents shall be obtained:

• Certificate of incorporation;
• Memorandum and Articles of Association;
• Permanent Account Number of the company;
• A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf;

One copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers or Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf.

For opening an account of a Partnership firm, one certified copy of each of the following documents shall be obtained:

• Registration certificate;
• Partnership deed;
• Permanent Account Number of the partnership firm;

One copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers or Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf.

For opening an account of a Trust, one certified copy of each of the following documents shall be obtained:

• Registration certificate;
• Trust deed;
• Permanent Account Number or Form No.60 of the trust;

One copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers or Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf-

For opening an account of an unincorporated association or a body of individuals, one certified copy of each of the following documents shall be obtained:

• Resolution of the managing body of such association or body of individuals;
• Permanent Account Number or Form No.60 of the unincorporated association or a body of individuals;
• Power of attorney granted to transact on its behalf;

One copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers or Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf identification information as mentioned under

Such information as may be required by the HFC to collectively establish the legal existence of such an association or body of individuals.

Explanation - Unregistered trusts/partnership firms shall be included under the term ‘unincorporated association' and the term 'body of individuals, includes societies.

 

For opening accounts of juridical persons not specifically covered in the earlier part, such as Government or its Departments, societies, universities and local bodies like village panchayats, one certified copy of the following documents shall be obtained:

• Document showing name of the person authorized to act on behalf of the entity;
• Aadhaar/PAN/ OVD for proof of identity and address in respect of the person holding an attorney to transact on its behalf and

Such documents as may be required by the HFC to establish the legal existence of such an entity/juridical person.

 

For Proprietorship firm any two of the following documents as a proof of business/activity in the name of the proprietary firm shall also be obtained

• Registration certificate.
• Certificate/license issued by the municipal authorities under Shop and Establishment Act.
• GST and income tax returns.
• GST certificate (provisional/ final).
• Certificate/registration document issued by Sales Tax/Service Tax/ Professional Tax authorities.
• lEC (Importer Exporter Code) issued to the proprietary concern by the office of DCFT/License/ certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute.
• Complete Income Tax Return (not just the acknowledgement) in the name of the sole proprietor where the firm's income is reflected, duly authenticated/ acknowledged by the Income Tax authorities.
• Utility bills such as electricity, water, and landline telephone bills.

In cases, where Company is satisfied that it is not possible to furnish two such documents, the company may accept only one of those documents as proof of business/activity. Provided Company undertake contact point verification and collect such other information and clarification as would be required to establish the existence of such firm, and shall confirm and satisfy itself that the business activity has been verified from the address of the proprietary concern.

 

For Identification of Beneficial Owner

For opening an account of a Legal Person who is not a natural person, the beneficial owner(s) shall be identified and all reasonable steps in terms of Rule 9(3) of the Rules to verify his/her identity shall be undertaken keeping in view the following:

• Where the customer or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies.
• In cases of trust/nominee or fiduciary accounts whether the customer is acting on behalf of another person as trustee/nominee or any other Intermediary is determined. In such cases, satisfactory evidence of the Identity of the intermediaries and of the persons on whose behalf they are acting, as also details of the nature of the trust or other arrangements in place shall be obtained.

KYC DOCUMENTS

Parameters	Features
KYC – know your customer	Norms issued by our regulators (both RBI & NHB) are to be followed as applicable from time to time.
	The KYC to be completed for all borrowers /co-borrowers.
	All KYC documents to be certified and OSV (original seen & verified) done.
	PAN verification from the verification facility available with the issuing authority
	Authentication of Aadhaar number with customer consent & in case of already available Aadhaar with authentication with customer consent shall suffice for periodic KYC updation.
	In case of low risk category customer, a self-declaration for no change of address and their identities shall suffice for periodic KYC updation.
	For Individuals – OVD Documents
	Passport
	Driving License
	Voters Identity card issued by the Election Commission of India
	Job Card issued by NREGA duly signed by an officer of the State Government,
	Letter issued by the National Population Register containing details of name and address.
	Aadhaar (optional for Non PMAY customers)
	If there is a change in the name subsequent to its issuance provided it is supported by a marriage certificate issued by the State Government or Gazette notification, indicating such a change of name.(Deemed OVD)
	Legal Entities
	For opening an account of a company, one certified copy of each of the following documents shall be obtained:
	(a) Certificate of incorporation;
	(b) .Memorandum and Articles of Association;
	(c) Permanent Account Number of the company;
	(d) A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf;
	(e) one copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers of Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf.
	For opening an account of a partnership firm, one certified copy of each of the
	following documents shall be obtained:
	(a) Registration certificate;
	(b) Partnership deed;
	(c) Permanent Account Number of the partnership firm;
	(d) one copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers of Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf.
	For opening an account of a trust, one certified copy of each of the following
	documents shall be obtained:
	(a) Registration certificate;
	(b) Trust deed;
	(c) Permanent Account Number or Form No.60 of the trust;
	(d) one copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers of Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf-
	For opening an account of an unincorporated association or a body of individuals, one certified copy of each of the following documents shall be obtained:
	(a) resolution of the managing body of such association or body of
	individuals;
	(b) Permanent Account Number or Form No.60 of the unincorporated
	association or a body of individuals;
	(c) power of attorney granted to transact on its behalf;
	(d) one copy of an OVD containing details of identity and address, one recent photograph and Permanent Account Numbers of Form 60 of the managers, officers or employees, as the case may be, holding an attorney to transact on its behalf identification information as mentioned under
	(e) Such information as may be required by the HFC to collectively establish the legal existence of such an association or body of individuals.
	Explanation - Unregistered trusts/partnership firms shall be included under the term 'unincorporated association' and the term 'body of individuals, includes societies.
	For opening accounts of juridical persons not specifically covered in the earlier part, such as Government or its Departments, societies, universities and local bodies like village panchayats, one certified copy of the following documents shall be obtained:
	(a) Document showing name of the person authorized to act on behalf of the entity;
	(b) Aadhaar/PAN/ OVD for proof of identity and address in respect of the person holding an attorney to transact on its behalf and
	(c) Such documents as may be required by the HFC to establish the legal existence of such an entity/juridical person.
	For Proprietorship firm any two of the following documents as a proof of business/activity in the name of the proprietary firm shall also be obtained
	(a) Registration certificate.
	(b) Certificate/license issued by the municipal authorities under Shop and Establishment Act.
	(c) Sales and income tax returns.
	(d) CST/V AT/CST certificate (provisional/ final).
	(e) Certificate/registration document issued by Sales Tax/Service Tax/
	Professional Tax authorities.
	(f) lEC (Importer Exporter Code) issued to the proprietary concern by the office of DCFT/License/ certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute.
	(g) Complete Income Tax Return (not just the acknowledgement) in the name of the sole proprietor where the firm's income is reflected, duly authenticated/ acknowledged by the Income Tax authorities.
	(h) Utility bills such as electricity, water, and landline telephone bills.
	In cases, where Company is satisfied that it is not possible to furnish two such documents, the company may accept only one of those documents as proof of business/activity. Provided Company undertake contact point verification and collect such other information and clarification as would be required to establish the existence of such firm, and shall confirm and satisfy itself that the business activity has been verified from the address of the proprietary concern.
	For Identification of Beneficial Owner
	For opening an account of a Legal Person who is not a natural person, the beneficial owner(s) shall be identified and all reasonable steps in terms of Rule 9(3) of the Rules to verify his/her identity shall be undertaken keeping in view the following:
	(a) Where the customer or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies.
	(b) In cases of trust/nominee or fiduciary accounts whether the customer is acting on behalf of another person as trustee/nominee or any other
	Intermediary is determined. In such cases, satisfactory evidence of the
	Identity of the intermediaries and of the persons on whose behalf they are acting, as also details of the nature of the trust or other arrangements in place shall be obtained.