Master Direction – Know Your Customer (KYC) Direction, 2016
This Master Direction outlines the Know Your Customer (KYC) norms for Regulated Entities (REs) to prevent money laundering and terrorist financing.
Applicability: This direction applies to all REs, including banks, financial institutions, and other entities regulated by the Reserve Bank of India.
Definitions: The direction defines various terms, including “customer,” which includes companies, partnership firms, unincorporated associations or bodies of individuals, and trusts.
Risk Assessment: REs must conduct a risk assessment to identify and assess the money laundering and terrorist financing risks associated with their customers, products, and services.
Designated Director and Principal Officer: REs must appoint a Designated Director and a Principal Officer to oversee the implementation of the KYC policy and ensure compliance.
KYC Policy: REs must have a KYC policy in place, which includes customer identification procedures, risk management, and ongoing monitoring.
This direction is effective from February 25, 2016, and has been updated several times, with the latest update being on January 04, 2024.
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Download: Master Direction – Know Your Customer (KYC) Direction, 2016 (Updated as on January 04, 2024)