Individuals who do not have an individual proof of residence can now open an account with any bank by producing the utility bill of a close relative as a proof of residence along with a declaration from the relative, said a notification from the Reserve Bank of India.
The utility bill, which is an important source of address proof, is generated in the name of the person owning the residence. There are instances where a wife staying with her husband or parents staying with their son, or children with parents find it difficult to open account in some banks as the utility bills required for address verification are not in their name.
"It is clarified, that in such cases, banks can obtain an identity document and a utility bill of the relative with whom the prospective customer is living along with a declaration from the relative that the said person (prospective customer) wanting to open an account is a relative and is staying with him," said the notification.
Banks can use supplementary evidence such as a letter received through post for further verification of the address.
The RBI has clarified that the adoption of customer acceptance policy and its implementation should not result in denial of banking services to general public, particularly to those financially and socially disadvantaged.
With regard to Know your Customer and Anti-Money Laundering practices, the RBI has asked banks to put in place a system of periodical review of risk categorisation of accounts and apply enhanced due diligence measures in case of higher risk perception on a customer. The review of risk categorisation should be done at least once in six months.
Banks are also advised that before opening any new account it should be ensured that the name of the proposed customer does not appear in the suspicious list. They should also scan all existing accounts to ensure that no account is held by or linked to any of the entities or individuals included in the list, the notification added.
