The Reserve Bank of India (“RBI”) has issued the Reserve Bank of India (Know Your Customer (KYC)) (Amendment) Directions, 2025 (“2025 Amendment”) to introduce the following:
1. In respect of an individual customer who is categorized as low risk, the Regulated Entities (“REs”) should allow all transactions and ensure the updation of KYC within one year of its falling due for KYC or upto June 30, 2026, whichever is later. Such accounts should be subjected to regular monitoring. This will also be applicable to low-risk individual customers for whom periodic updation of KYC has already fallen due.
2. With the present amendment, REs has to intimate its customers, in advance, to update their KYC. Prior to the due date of periodic updation of KYC, the RE must give at least 3 advance intimations, including at least 1 intimation by letter, at appropriate intervals to its customers through available communication options/ channels for complying with the requirement of periodic updation of KYC. Additionally, subsequent to the due date, the RE must give at least 3 reminders, including at least 1 reminder by letter, at appropriate intervals, to such customers who have still not complied with the requirements, despite advance intimations. The letter of intimation/ reminder may, inter alia, contain easy to understand instructions for updating KYC, escalation mechanism for seeking help, if required, and the consequences, if any, of failure to update their KYC in time. Issue of such advance intimation/ reminder shall be duly recorded in the RE’s system against each customer for audit trail. The RE shall expeditiously implement the same but not later than January 01, 2026.
3. With respect to Updation / Periodic Updation of KYC of individuals, a new provision has been inserted regarding “Use of Business Correspondent (BC) by banks for Updation/ Periodic Updation of KYC” which states that self-declaration from the customer in case of no change in KYC information or change only in the address details may be obtained through an authorized BC of the bank. The bank has to enable its BC systems for recording these self-declarations and supporting documents thereof in electronic form in the bank’s systems.
Please refer to the hyperlink below for e detailed read of the amendment.
Source: Reserve Bank of India
