RBI has also advised banks to organize camps and launch intensive campaigns for updating KYC. Along with this, the central bank has also made amendments related to dormant accounts and unclaimed deposits.
The Reserve Bank has taken steps to provide relief to customers in the matter of KYC update. Under this, banks and other financial institutions coming under the purview of RBI have been asked to give notice to their customers in an appropriate manner for updating KYC from time to time.
RBI Circular
RBI said in a circular that it has seen a large number of pending cases in updating Know Your Customer (KYC) from time to time. This includes accounts opened for receiving funds under Direct Benefit Transfer (DBT) / Electronic Benefit Transfer (EBT) and accounts opened under Pradhan Mantri Jan Dhan Yojana (PMJDY). This step has been taken to make the process easier for the convenience of the customers. Under this, instructions regarding timely update of KYC have been revised. Through this, bank representatives have been allowed to be involved in the process of updating KYC.
Must be informed in advance
In this context, the central bank issued Know Your Customer (Amendment) Directions, 2025. According to the new instructions, entities (REs) under the purview of RBI will inform their customers in advance to update their KYC. It said that before the due date of updating KYC at fixed intervals, banks and other financial institutions will give at least three advance notices to their customers at reasonable intervals through available communication options / channels to comply with the requirement to update KYC. At least one of these will be given through a letter.
After the due date, banks will give at least three reminder letters to such customers at reasonable intervals. At least one of these will be given through a letter. This will be for those customers who have still not complied with the requirements related to KYC despite advance notice.
