KYC is necessary for opening and maintaining current accounts of individuals, proprietorship, partnership firms, corporates, trusts, Associations, societies, clubs etc. When the bank accounts of individuals are opened, banks mainly look into the identity and address proof of the applicant such as official valid documents (OVDs) like Aadhar card, Voter ID, PAN card, Driving License, Passport, NREGA Job card etc. If some other person is operating on behalf of the account holder as mandate holder or power of attorney, the OVDs of such persons also verified by the banks. In the cases of legal person/entity (other than non-natural persons) banks open the accounts only after verifying legal status of the entity, identities of promoters/directors/controllers and authorized signatories of the account. If the officially valid document submitted for opening a bank account has both, identity and address of the person, there is no need for submitting any other documentary proof separately for the purpose. In all the cases of account opening, photographs of the persons opening and operating the account shall be submitted to the bank. Accounts opened by other banks, Local Authorities and Government Departments (excluding public sector undertakings or quasi-Government bodies) are exempted from the requirement of photographs.
As per RBI guidelines, in addition to seeking NOC from the existing bankers of the prospective current account customer, banks should seek information from CRILC and verify the data received from the CRILC, whether the prospective customer is enjoying credit facilities from another bank. Also, banks have to seek ‘No Objection certificate’ from the drawee bank where the initial deposit to current account is made by way of a cheque.
Banks prescribe threshold limits for a particular category/categories of accounts based on risk perception as low risk, medium risk, high risk, exceptionally high risk etc. and fix the risk level threshold limit to each account in order to monitoring transactions of cash and transactions of suspicious nature in the account and reporting it to appropriate authority as per KYC norms/AML standard.
The KYC documents obtained by banks for various categories of accounts are as under.
- Identity and address proof of the proprietor with Telephone/Fax Number/email address,
- Any two of the below documents would suffice. These documents should be in the name of the proprietary concern.
- If the firm is in the business of import & export, IEC (Importer Exporter Code) issued to the proprietary concern by the office of DGFT
- Licence/certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute.
- Proof of the legal name of the firm such as Business Registration certificate, Shops & Establishments Registration certificate, or Factory Registration certificate or Sales Tax Registration/ Service Tax Registration, etc.
- Sales and income tax returns
- Copy of the Partnership deed,
- Proof of registered address of the firm,
- Proof of correspondence address of the firm along with Telephone/Fax Number/email address
- Names of all partners, their addresses and Telephone numbers,
- Proof of the legal name of the firm such as Business Registration certificate, Shops & Establishments Registration certificate, Factory Registration certificate or Sales Tax Registration/ Service Tax Registration, etc.
- Letter of authority or Power of Attorney granted if the firm has authorized any of its employees to transact business on behalf of the firm along with identity and address proof of such authorized persons.
- Certified copy of Certificate of incorporation/Registration certificate of the company,
- Evidence of registered address,
- Proof of correspondence address of the company (telephone bill) along with Telephone/Fax Number/email address
- Certificate of incorporation and Memorandum & Articles of Association,
- PAN card proof of the company
- Latest Annual Return with the ROC acknowledgement,
- List of Directors and the Form 32s supporting their director status,
- Resolution of the Board of Directors to open an account and identification of those (including employees) who have authority to operate the account,
- Identity and address proof of authorized signatories, Managing Director, Chairman and signatories to the Board Resolution
- In the cases of unlisted companies or entities listed on a non-approved stock exchange; OVDs of ultimate individual shareholders holding 10% and above capital of the company.
- Also KYC for any company which is a significant shareholder of this company.
Trusts & foundations
- Copy of the Trust deed,
- Registration certificate of the Trust,
- If the Trust is not registered, PAN Number/Acknowledgement copy of Income Tax return,
- Certified copy of the resolution regarding opening and operation of the account.
- Details of all the present trustees, settlers, beneficiaries and signatories with their identity and address proof,
- Copy of power of attorney granted to any employees to transact business of the trust.
- Registered & communication address of the Trust with Telephone/fax number/e-mail address.
Body of individuals (includes societies, educational institutions, Associations, Clubs, etc.)
- Certified true copy of the Rules, Regulations, and Bye-laws (as the case may be certified true copy of Certificate of Registration or incorporation in the case of registered bodies (o
- A certified true copy of the Resolution to open the bank account (certified by the Chairman of the meeting of the Governing Board or Managing committee or like body, at which resolution was passed), with the list of office-bearers authorised to operate the account in accordance with the Rules and Bye- laws of the body.
- Photographs of authorised representatives to operate the bank account with their ID & Address proofs.
- A copy of the balance sheet in the case of a co-operative society, if available