Know Your Customer norms apply to NBFCs

Mumbai: The Reserve Bank of India (RBI) has said that the guidelines it issued to banks on the `Know Your Customer' (KYC) are equally applicable to non-banking financial companies (NBFCs).

All NBFCs have been advised to adopt these norms with suitable modifications, depending on their activity. They should ensure that a proper policy framework on KYC and non-banking financial companies (NBFCs).

NBFCs must ensure that they fully comply with these norms by December 31, 2005, the RBI has said. They must keep confidential all information collected from customers for the purpose of opening accounts and not divulge any details for cross-selling.

The NBFCs have been asked to ensure that the information sought from the customer is relevant to the perceived risk, is not intrusive, and in conformity with the guidelines.