• Competent Authority to accord permission to file an Appeal: Chairman or the Managing

Director / Chief Executive Officer or, in their absence, the Executive Director / Official of
equal rank.

)
77
65
1.15. Know Your Customer (KYC) Guidelines:

12
K
Reserve bank of India has now come out with guidelines for “KNOW YOUR CUSTOMER”

.(A
(KYC) with a view to put in place systems and procedures to help control frauds, identify money
laundering and suspicious activities and for scrutiny /monitoring of large value transactions.

IT
The guidelines are also applicable to foreign currency accounts / transactions.

K
The four pillars under the policy

N
a) Customer Acceptance Policy -

A
b) Customer Identification procedure
c) Risk Management ( MLRC)
d) Monitoring of transactions
T
A
W

Reporting Requirements
A

a) Reports to be furnished to FIU-IND

M

Bank follows the detailed guidelines contained on compilation and manner /

procedure of submission of following reports prescribed by FIU-IND and ensure for its
U

error free and timely submission to them.

K

a. Cash Transactions Report (CTR)

r.

b. Suspicious Transactions Report (STR);

M

c. Counterfeit Currency Report (CCR);

d. Non Profit Organizations Transactions Report (NTR)
y:

e. Cross-Border Wire Transfer Report (EFT)

B

a) Cash Transaction Reports (CTRs):

d

Bank files following types of Cash Transactions to FIU-IND, New Delhi. -

de

a. All cash transactions of the value of more than Rupees Ten Lakh or its equivalent in
foreign currency;
oa

b. All series of cash transactions integrally connected to each other which have been
nl

valued below Rupees Ten Lakh or its equivalent in foreign currency where such series
of transactions have taken place within a month and the aggregate value of such
ow

transactions exceed Rupees Ten Lakh;

D

Time Schedule for Filing Cash Transaction Reports (CTR)

The Cash Transaction Report (CTR) for each month for Bank as a whole is submitted
to FIU-IND by 15th of the succeeding month as advised by Reserve Bank of India.

21
 In order to ensure above time schedule, various offices are required to ensure following
time schedule:
a. Data Centre submits CTRs for branches invariably on monthly basis (not on
fortnightly basis) by 04th of the succeeding month to Head Office in text format by e-

)
mail.

77
b. The Principal Officer of the bank ensures submission of CTRs for entire bank
every month to FIU-IND within the prescribed time schedule i.e. by 15th of the

65
succeeding month.

12
b)Suspicious Transaction Reports (STRs):

K
.(A
Bank files all suspicious transactions as mentioned in the PMLA Rules to Financial
Intelligence Unit – India (FIU-IND). While determining suspicious transactions, bank is
guided by definition of suspicious transaction contained in PMLA Rules as amended

IT
from time to time. Bank also files Suspicious Transaction Reports (STR) to FIU-IND for

K
Mobile Banking Transactions as in case of normal banking transactions.
Definition of Suspicious Transaction in PMLA Rules:

N
“Suspicious Transaction" means a transaction whether or not made in cash which, to

A
a person acting in good faith –
T
a. Gives rise to a reasonable ground of suspicion that it may involve the proceeds of
A
crime; or
W

b. Appears to be made in circumstances of unusual or unjustified complexity; or

c. Appears to have no economic rationale or bonafide purpose; or
A

d. Gives rise to a reasonable ground of suspicion that it may involve financing of the
M

activities relating to terrorism.

U
K

It is likely that in some cases transactions are abandoned / aborted by customers on

being asked to give some details or to provide documents. Branches should report all
r.

such attempted transactions through the menu “AMLALERT” and Regional Offices
M

should file STRs on these attempted transactions, even if not completed by customers,
irrespective of the amount of the transaction.
y:

Did you know?

Indicative List of Suspicious Activities: Branches should do STR
B

(1) Transactions Involving Large Amounts of Cash through menu “AMLALERT and
Regional Offices should file
d

(2) Transactions that do not make Economic Sense

STRs.
Activities not consistent with the Customer’s Business
de

(3)
(4) Attempts to avoid Reporting/Record-keeping Requirements
oa

(5) Unusual Activities

(6) Customer who provides Insufficient or Suspicious Information
nl

(7) Certain Suspicious Funds Transfer Activities

ow

(8) Certain Bank Employees arousing Suspicion

(9) List of alert Indicators of suspicious activities/transactions to be monitored by the
D

operating staff at branch level:

Time Schedule for Filing Suspicious Transaction Reports (STR):

22
 Bank will adhere to the following time schedule and procedure for reporting STRs to FIU-
IND:
a. The Suspicious Transaction Report (STR) will be furnished within -7- days of arriving

)
at a conclusion that any transaction, whether cash or non-cash, or a series of transactions

77
integrally connected are of suspicious nature. The Principal Officer will record his reasons
for treating any transaction or a series of transactions as suspicious. It will be ensured

65
that there is no undue delay in arriving at such a conclusion once a suspicious transaction

12
report is received from the Regional Offices.
b. Regional Office will submit the STRs to the Principal Officer after validation in four days

K
of arriving at a conclusion that any transaction is suspicious one.

.(A
c) Counterfeit Currency Reports (CCRs)

IT
All cash transactions, where forged or counterfeit Indian currency notes have been used

K
as genuine will be reported by the Principal Officer (PO) to FIU-IND in the specified format
(Counterfeit Currency Report – CCR) by 15th of the succeeding month. These cash

N
transactions will also include transactions where forgery of valuable security or

A
documents has taken place and will be reported in the form as prescribed by bank to FIU-
IND for the present. T
A
W

d) Non-Profit Organisation Transaction Report (NTR)

A

The report of all transactions involving receipt by non-profit organizations of value more
M

than rupees ten lakh or its equivalent in foreign currency is being submitted every month
U

to the Director, FIU-IND by 15th of the succeeding month in the prescribed format.
K

e) Cross-border Wire Transfer Report (EFT)

r.
M

Cross-border Wire Transfer Report is required to be filed with FIU-IND by 15th of

succeeding month for all cross border wire transfers of the value of more than five lakh
y:

rupees or its equivalent in foreign currency where either the origin or destination of
B

fund is in India. The Principal Officer at Head Office submits EFT to the Director FIU-
d

IND, New Delhi.

de

The objectives of the KYC framework are to ensure appropriate customer identification.
oa

In this connection branches to obtain all information necessary to establish the identity
/legal existence of each new customer, based preferably on disclosures by customers
nl

themselves. Mainly, KYC norms are for (1) Identification of the customer, (2) Proper
ow

introduction of the customer and (3) monitoring of large value transactions.

D

1) Customer Identification –
(a) Customer identification means undertaking client due diligence measures while
commencing an account based relationship including identifying and verifying the
customer and beneficial owner on the basis of one of the Officially Valid Documents
(OVDs).

23
 (b) Bank has a policy approved by its Board which clearly spells out the Customer
Identification Procedure to be carried out at different stages,i.e.,
i) While establishing an account-based relationship with the customer;
ii) Carrying out any international money transfer operations for a person who

)
is not an account holder of the Bank;

77
iii) When the branch has a doubt about the authenticity or adequacy of the
customer identification data it has obtained;

65
iv) When branches sell third party products as agents;
While selling bank’s own products, payment of dues of credit cards/sale

12
v)
and re-loading of prepaid/ travel cards and any other product for more than

K
Rs.50,000/-

.(A
vi) While updating identification data of the existing customer at prescribed
intervals.
vii) While carrying out transactions for a non-account based customer i.e. a

IT
walk-in customer, where the amount involved is equal to or exceeding Rs. 50,000/-

K
whether conducted as a single transaction or several transactions that appear to
be connected;

N
viii) When a branch has reason to believe that a customer (account-based or

A
walk-in) is intentionally structuring a transaction into a series of transactions below
the threshold of Rs.50,000/- T
A
W

2) The branches to undertake periodical updation of KYC data (including photograph/s)

after the accounts are opened. The periodicity of such updation should not be less
A

than once in five years in case of low risk category customers and not less than once
M

in two years in case of high and medium risk categories.

U

It has also been advised to enter all relevant information pertaining to customer and
K

account in Finacle and update CBS data regularly. In order to comply with the guidelines
r.

and ensure perfection in KYC and CBS data (report can be generated through RPTRA).
M
y:

KYC guidelines regarding enrichment of Beneficial Owner information.

B

The Beneficial Owner are identified in Non-Individual account (other than proprietorship,
d

listed public limited companies, Government Organization including PSUs), as following:-

de

a. Where the customer is a company: The Beneficial Owner is the natural person(s),
oa

who, whether acting alone or together, or through one or more juridical person, has a
controlling ownership interest or who exercises control through other means.
nl

Explanation- For the purpose of this sub clause- "Controlling ownership interest"
ow

means ownership of or entitlement to more than 25% of shares or capital or profits of

the company;
D

b. Where the customer is a partnership firm: The Beneficial Owner is the natural
person(s), who, whether acting alone or together, or through one or more juridical
person, has/have ownership of/entitlement to more than 15 per cent of capital or
profits of the partnership.

24
 c. Where the customer is an unincorporated association or body of individuals:
The Beneficial Owner is the natural person(s), who, whether acting alone or together,
or through one or more juridical person, has/have ownership of/entitlement to more
than 15 per cent of the property or capital or profits of the unincorporated association

)
or body of individuals.

77
Explanation: Term 'body of individuals' includes societies. Where no natural person

65
is identified under (a), (b) or (c) above, the Beneficial Owner is the relevant natural

12
person who holds the position of senior managing official.

K
Where the customer is a trust: The identification of Beneficial Owner(s) shall

.(A
include identification of the author of the trust, the trustee, the beneficiaries with 15 %
or more interest in the trust and any other natural person exercising ultimate effective
control over the trust through a chain of control or ownership.

IT
K
Branches are aware that they have to identify all the BO in the account and to

N
complete Customer due diligence process also for all BOs as being carried out for

A
individual customers.
T
A
As per circular issued by KYC-AML department, Branches are also advised to
W

ensure following:
A
M

 Identification of Beneficial owner is required for accounts of all Non individual

U

entities including advance accounts.

 All granular information is enriched in the system related to Beneficial Owner after
K

carrying out customer due diligence and obtaining their complete KYC
r.

information.
M

 Create the customer ID of Beneficial Owner mandatorily even if it is not

authorized signatory and to be linked with the account as BO.
y:

 Branch to also obtain the Beneficial Owner’s declaration from the entity and
B

Branch to satisfy upon the Information provided by the customer . The

same should be kept on record.
d
de

Enrichment of Beneficial owner information in Finacle :- .

oa


nl

As per the guidelines information of beneficial owner in case of non- individual

entities(other than proprietorship, Government accounts) have to be
ow

enriched/identified in finacle through HACM menu -> Related party Tab ->
designation code field and Code "BO" = "Beneficial owner" is to be selected from
D

drop down list.

 The branches have to enrich beneficial owner information only under designation
code and even if the information is already available in Relation Code field, the
same needs to be enriched again in designation code field, after which the
process of identification of BO will be completed.

25
 (Ref: HO:BR:112:213 Dt: 22/05/2020)
Freezing and Closure of Non- Compliant Accounts:
Branches shall opt for a phased closure of operations in this account as explained below:
1. Branches shall ‘Debit freeze’ such Non- KYC Compliant Accounts after giving two

)
77
notices of minimum 07 days period each to the customers to comply with KYC
requirements. Thereafter, ‘Debit freezing’ should be imposed.

65
2.Even after debit freezing of the account if the customer is not turned up to the
Bank, branch/office may also cease the operations in the account or close the

12
account after giving final notice of minimum 15 days period.

K
3.The account holders shall have the option, to revive their accounts by submitting the

.(A
KYC documents
4.On closure of the account the customer shall be communicated on his/ her valid e-

IT
mail address/ mobile number registered with the bank.
4. In case where wrong credits are received in the Non-KYC compliant freezed

K
accounts, Regional Manager is empowered to make a request to DGM, Data

N
Center for unfreezing of such accounts for reversal of such entry as a special case

A
on one time basis.
T
5. When the branches believe that it would no longer be satisfied about the true
A
identity of the account holder, it should submit a Suspicious Transaction Report (STR)
to HO for onward filing the same with Financial Intelligence Unit- India(FIU-IND.
W
A

Small Accounts:
M

In case an individual customer who does not have Aadhaar/enrolment number and PAN
U

and desires to open a bank account, banks shall open a ‘Small Account’.
K
r.

In ‘Small Account’ means a saving bank account in which:

M

 The aggregate of all credits in a financial year does not exceed rupees one lakh
 The aggregate of all withdrawals and transfers in a month does not exceed rupees
y:

ten thousand and

B

 The balance at any point of time does not exceed rupees fifty thousand.
 Not to allow Foreign Inward remittance
d
de

A small account shall remain operational initially for a period of twelve months, and
thereafter for further period of twelve months if the holder of such an account provides
oa

evidence, before the bank, of having applied for any of the OVDs within twelve months
nl

of the opening of the said account, with the entire relaxation provisions to be reviewed
ow

in respect of the said account after twenty four months.

Procedure to be followed in respect of foreign students:

D

Branches should follow the following procedure for foreign students studying in India:
a.Branches may open a Non Resident Ordinary (NRO) bank account of a foreign student
on the basis of his/her passport ( with appropriate visa & immigration endorsement)
bearing the proof of identity and address in the home country along with a photograph

26
 and a letter offering admission from the educational institution in India provided:

I. Branches should obtain a declaration about the local address within a period of -30
days of opening the account and verify the said local address.

)
77
II. During the 30 days period, the account should be operated with a condition of allowing
foreign remittances not exceeding USD 1,000 or equivalent into the account and a cap

65
of monthly withdrawal to Rs. 50,000/-, pending verification of address.

12
a. On receipt of proof of current address, the account would be treated as a

K
Normal NRO account and should be operated in terms of Reserve Bank of

.(A
India instructions on Non-Resident Ordinary Rupees (NRO) Account, and
the provisions of FEMA, 1999.
b. Students with Pakistani nationality will need prior approval of the Reserve

IT
Bank for opening the account.

K
N
1.16. Financial Intelligence Unit (FIU-IND) was setup in Nov.2004 and reports directly to the

A
Economic Intelligence Council headed by Finance Minister. The responsibility of FIU
T
includes collecting, analysing and sharing of information acting as a central repository
A
and coordinating with local and overseas agencies involved in anti money laundering
W

activities.
A
M

E-KYC:-
U

Acceptance of E-KYC as a process for KYC is launched by UIDAI-Unique Identification

K

authority of India is a valid process for KYC verification .The information authenticated &
r.

transferred by UIDAI carrying demographic details & photograph as a result of E-KYC

M

Process shall be treated as sufficient proof of identity. E-KYC is also accepted as a valid
y:

proof of identity for opening of Basic SB a/c at BC/KIOSK level.

B

CKYC: - Central KYC Registry is a centralized repository of KYC records of customers in

d

the financial sector with uniform KYC norms and inter-usability of the KYC records across
de

the sector with an objective to reduce the burden of producing KYC documents and
getting those verified every time when the customer creates a new relationship with a
oa

financial entity.(HO: BR: 108:129 dated 06.08.2016)

nl

The OVD (Officially Valid Documents) are:

ow

Passport/ Driving License with photo, Aadhaar card issued by the UIDAI, Voter ID issued
D

by the Election commission of India, job card under NREGA issued by the State
Governments,

Registration certificate of the firm issued by the Municipal corporation under the Shops

27
 and establishment Act, Certificate of incorporation in case of companies, Sales Tax/ IT
returns, in case of corporate a/cs.

List of ‘Officially Valid KYC Documents’ for Account Opening must be obtained from the

)
customers to verify the identity and address of the customers. It must be noted that only

77
the documents mentioned in the list provided by the RBI would be accepted by the

65
branches while opening of any new account. Branches would not have the discretion to
accept any other document for this purpose.

12
The RBI also enforces the compliance of stipulated norms in respect of Forex transactions

K
by the banks.

.(A
Anti Money Laundering:

IT
It is conversion of money, which is illegally obtained, so as to make it appear to originate

K
from a legitimate source. The main objective of the Act is:

N
A
1. To prevent, combat and control money laundering.
T
2. To confiscate and seize the property obtained from the laundered money.
A
W

3. To deal with any other issue connected with money laundering in India.
A

There are three independent steps or stages in Money Laundering -- Placement,

M

Layering and Integration

U
K

A) Placement - physical disposal of bulk cash proceeds derived from illegal activity
B) Layering - process of separation of illicit proceeds from their source by creating
r.

complex layers of financial transactions it conceals the audit trail.

M

C) Integration– re-injection of laundered proceeds back to the economy

y:
B

Punishment: Whoever commits the offence of money laundering shall be punished with
d

the rigorous punishment for a term not less than 3 years but which may extend to 7 yrs
de

and shall also liable to fine, which may extend to Rs.5 lacs. (HO: BR: 109:153 dated
01.09.2017 –KYC guidelines, Anti Money Laundering /CFT & Obligations under
oa

PMLA Act 2002 -Master Circular).

nl

1.17. FATCA- (Forign Account Tax Compliance Act):

ow

FATCA is an acronym for Foreign Account Tax Compliace Act, a new set of US Tax
Regulations brought in by the US Government to prevent the tax evasion by US Nationals
D

and the same enacted through the Internal Revenue Services (IRS). FATCA promotes
cross border tax compliance by implementing an international standard for the automatic
exchange of information related to US taxpayers. FATCA regulations require tax
authorities obtain detailed account information for US taxpayers on an annual basis.

28
 FATCA is intended to increase transparency for the Internal Revenue Service (IRS) with
respect to US persons that may be investing and earning income through non-US
institutions. While the primary goal is to gain information about US persons, FATCA
imposes tax withholding where the applicable documentation and reporting requirements

)
77
are not met.

65
CRS: CRS stands for Common Reporting Standards. The primary role of CRS is to
combat the problem of offshore tax evasion and avoidance/stashing of unaccounted

12
money abroad through mutual exchange of information among countries. 98 countries

K
are members of CRS.

.(A
Now FATCA CRS information can also be submitted through Baroda Connect.
(BCC:BR:111:247 dated 31.05.2019) FATCA details in CBS is managed through menu

IT
HFATCA. Following are mandatory fields in HFATCA:

K
1. Date of Birth

N
2. City of Birth

A
3. Country of Birth
4. PAN or Father’s Name T
A
5. Tax Resident Country
W

6. TIN or Tin equivalent

A
M

Guidelines in FATCA & CRS guidelines as under:

U

*Account of NRIs should be opened in NRE/NRO/FCNR category and not as domestic

K

accounts.
r.
M

*In cane of pre-existing customers (account opened upto 30-06-2014), if customer

submit the change in circumstances (any modification request in account, the branch to
y:

obtain the self-declaration from the customer and enrich the same in Find through
B

"HFATCA menu (BOB).

d

• In case of new customers accounts opened on or after 01:07 2014), branch to invariably
de

obtain the self-declaration in the preworbed format with the account opening form and
enrich the same in system through “HFATCA" menu.
oa

• FATCA CRS declaration ottained from the customers is to Opening Form kept with the
nl

Account.
ow

If the account is opened through RBO, copies of the FATCA CRS declaration is to be kept
D

at branches super scribing account number and Customer ID thereon.

Branches to generate the report through FATCARP" menu peridodically and enrich
the information of FATCA CRS declaration obtained from customer , wherever the same
is not enriched in CBS as per the report.

29
 FATCA-CRS declaration is to be obtained from each main holder as well as joint holders
separately .

)
(Refer to HO:BR:112:362 dated 02.09.2020)

77
Guidelines for updating FATCA CRS information in the account of SEAFARERS:

65
12
1.FATCA-CRS form in itself is a self-declaration for tax residency, no need to take any
additional self-declaration from the account holder.

K
.(A
2.As in some cases of seafarer, where TIN is not available, branch can enter valid VISA
number, Duty Discharge Identity Book(DDIB) & Continuous Discharge Certificate (CDC)
for Sea farers (for details refer Annexure -1), Passport number etc. in TIN field and

IT
mention the document name in the adjacent document type field HFATCA menu.

K
3.There is no need of any separate constitution code especially for updating FATCA CRS

N
information for seafarers in Finacle.

A
T
Therefore we request to all our branches to take a careful note of the above guidelines
A
and ensure strictly compliance the above mentioned guidelines for the FATCA-CRS
W

enrichment in the account of SEAFARERS.

A

(Refer to BCC:BR:112:600 dated 06.10.2020)

M
U

1.18. Citizen’s Charter

K

Citizen Charter gives the customers’ right as well as their demands on service from the
r.

bank. Citizen’s charter covers the following:

M
y:

1. Business hours to be prominently displayed at the branches.

2. Counters to remain attended to during business hours.
B

3. Space for customers in banking hall to be kept clean and tidy with proper seating
d

arrangements.
de

4. Branch premises to be kept clean and hygienic.

oa

5. Time norms for common Banking transactions to be displayed prominently in the

Banking Hall.
nl

6. At large branches “May I Help You” – counters to be located for customer’s

ow

convenience.
7. Commencement of working hours of Bank staff to be 15 minutes before
D

commencement of Banking hours.

8. Bank’s name board to be clean and visible with suitable lighting arrangements.
9. Branch authority’s name and designation to be displayed on Name Plate.
10. Name, address, telephone number and fax numbers of Regional and Zonal

30