Fresh KYC norm may raise costs for telcos’ payments banks

By: | Published: February 22, 2018 4:22 AM

Telecom companies operating payments banks may see costs associated with know-your-customer (KYC) authentication rising after the Reserve Bank of India (RBI) on Tuesday asked all payments banks to get customers’ information verified themselves or by third parties (provided they are regulated), at their option, to ensure compliance under the Prevention of Money Laundering Act (PMLA).

Telecom companies, know-your-customer, Reserve Bank of India, PMLA, Airtel Payments Bank, Reliance Industries, Aditya Birla group, VodafoneThe only telecom company which has started full-fledged operations as a payments bank is Bharti Airtel. (IE)

Telecom companies operating payments banks may see costs associated with know-your-customer (KYC) authentication rising after the Reserve Bank of India (RBI) on Tuesday asked all payments banks to get customers’ information verified themselves or by third parties (provided they are regulated), at their option, to ensure compliance under the Prevention of Money Laundering Act (PMLA). The only telecom company which has started full-fledged operations as a payments bank is Bharti Airtel. According to sources, Airtel Payments Bank has been using customer information collected and verified within the company to carry out KYC. “RBI may have done this to ensure that it has control over the KYC process because it does not directly regulate telecom companies,” an industry executive said. Other telecos having payments bank licences are Reliance Industries-owned Jio, Aditya Birla group and Vodafone. On an average, the cost of KYC process for a customer could be between `50 and `100.

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