Reserve Bank of India simplifies KYC norms for Self Help Groups

MUMBAI: The Reserve Bank of India has simplified the know your customer or KYC norms for Self help groups or SHG for opening new accounts and while borrowing from banks.

The banking regulator has said in a notification issued to banks that KYC verification of all the office bearers of the SHG would suffice and that KYC verification of all the members of SHG need not be done while opening the savings bank account. It has clarified that

As regards KYC verification at the time of credit linking of SHGs, RBI has clarified that since KYC would have already been verified while opening the savings bank account and the account continues to be in operation and is to be used for credit linkage, no separate KYC verification of the members or office bearers is necessary.