The Banking Tutor

Study Material – Promotion 2023

No. 006 21-09-2023

KYC & AML - 02

01. Politically Exposed Persons (PEPs) to be classified as High Risk
Customer.

02. Customers who are close relatives of PEPs and accounts of which a PEP
is the ultimate beneficial owner to be classified as High Risk Customer.

03. Those with dubious reputation as per public information available to be

classified as High Risk Customer.

04. Accounts of non-face-to-face customers to be classified as High Risk

Customer.

05. High Net worth Individuals to be classified as High Risk Customer.

06. Non-Resident customers to be classified as High Risk Customer.

07. Accounts of Cash intensive businesses such as accounts of bullion

dealers & jewellers to be classified as High Risk Customer.

08. Overall Risk grade for the customer will be the Highest Risk grade among
the chosen parameters.

09. Review of Customer Risk Categorization - to be carried out not less than
once in six months i.e.as on 15th of May and November every year.

10. KYC exercise should be done at least every two (2) years for High Risk
customers.

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11. KYC exercise should be done at least every eight (8) years for Medium
Risk customers.

12. KYC exercise should be done at least every ten (10) years for Low Risk
customers.

13. Customer Identification Procedure means undertaking client Due

Diligence (CDD) measures based on the Risk profile, while commencing an
account based relationship (whether regular or occasional).

14. Customer identification procedure to be carried out – While selling bank's

own product for more than Rs 50000/-.

15. Customer identification procedure to be carried out - During periodic

review of KYC.

16. Accept only the Officially Valid Documents (OVD) while opening of
accounts/ periodical KYC up-dation.

17. A document is deemed to be an “Officially Valid Document” even if there

is a change in the name subsequent to its issuance, provided it is supported
by a marriage certificate issued by State Government or a Gazette
notification.

18. Passport is a OVD in case of Individual Customer.

19. Driving License is a OVD in case of Individual Customer.

20. Aadhaar card or Proof of possession of Aadhaar number is a OVD in

case of Individual Customer.

21. Voter Identity Card issued by Election Commission of India is a OVD in

case of Individual Customer.

22. Job Card issued by NREGA duly signed by an officer of the State
Government is a OVD in case of Individual Customer.

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23. Letter issued by the National Population Register containing details of
name and address is a OVD in case of Individual Customer.

24. Certificate of incorporation is a OVD in case of Company.

25. Memorandum and Articles of Association is a OVD in case of Company.

26. Do not insist on a Company's Common Seal, unless there is a provision

to that effect in their Memorandum and Articles of Association.

27. Parameters for defining High Net worth Individuals - Customers with any
of the following:

a) Average balance of Rs. 100 lakh and above in all (SB+CA+TD)

deposit accounts.

b) Enjoying Fund based limits/term loans exceeding Rs. 100 lakh.

28. Registration certificate is a OVD in case of Partnership Firms.

29. Partnership deed is a OVD in case of Partnership Firms.

30. PAN Card of the Firm is a OVD in case of Partnership Firms.

Sekhar Pariti
+91 94406 41014

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