In many cases, the branches did not appear to have observed customer identification procedures and did not obtain the photographs of depositors when the accounts were opened. Further, payments were also made from these deposit accounts to third parties. In some cases, even specimen signatures of depositors were not verified, Nabard said.
Sources in Nabard told FE on Tuesday that these developments are serious as these banks are aware that wages paid to beneficiaries under the National Rural Employment Guarantee Scheme are through bank accounts and are aimed at ensuring that the payment goes to the right person. They also added that RRBs, SCBs and DCCBs have been once again asked to follow KYC norms while opening deposit accounts, and also to ensure that due diligence is exercised in servicing deposit accounts as per established banking practices.
Nabards message is crucial as it comes at a time when the Congress-led government at the Centre has taken a serious view of recent irregularities in the implementation of NREGA in various states. According to NREGA, payment of wages to workers under this scheme should be made within 15 days of the completion of work. In the case any delay, the state government concerned will have to pay compensation to the worker in accordance with the Payment of Wages Act, 1936. According to the new guidelines, NREGA workers are now being paid through their bank or post office accounts. However, in a few instances, it has been seen that the time taken in completing the transactions also result in the delay of payments.