KYC norms for self-help groups relaxed : RBI
In order to address the difficulties faced by SHGs in complying with Know Your Customer (KYC) norms while opening savings bank accounts and credit linking of their accounts, RBI has held that the banks can open savings account for the SHG even if ‘know your customer’ verification is completed for only the office bearers of the SHG. Thus, it has been decided to simplify certain norms for SHGs.
Thus, it will not be mandatory for the banks to complete the KYC of all members of the SHG before opening a bank account, rather now, verification can be completed only for the office bearers of the SHG.
Also, as the banks would have already completed the KYC norms for the SHG while opening SHG’s bank account, there would be no need for a separate KYC verification while giving credit to the SHGs.
Categories: Banking Current Affairs 2017