Bank accounts blocked: Many facing KYC woes

Senior citizens say the insistence on personal visits is unreasonable during a pandemic

People are flocking to banks after their accounts were blocked in the course of a ‘know your customer’ exercise that began on October 1 in some banks.

Metrolife spoke to senior bank officers who say they are just adhering to the Anti-Money Laundering (AML) Standards and Combating of Financial Terrorism Guidelines laid down by Reserve Bank of India.

Customers cite a number of difficulties, observing that a pandemic is not the best time for banks to insist on personal appearance.

A senior officer with a nationalised bank says banks usually undertake the KYC exercise at least every two years for high risk customers, eight years for medium risk customers and 10 years for low risk customers.

“This is done for confirmation of the identity and address and other details,” he says.

Tell-tale signs

When a bank sends letters, cheque books, ATM cards and they are returned, it goes the extra mile to verify the address, he explains.

A senior officer with another nationalised bank, says the KYC procedure is only being enforced for depositor accounts and not current accounts.

“Frauds are aplenty and KYC helps us distinguish genuine customers from fake ones. Once the documents are submitted, the blocked account is activated,” he says.

Another bank officer says customers are usually given six months to respond to the KYC upgradation alerts.

“We block their accounts just to ensure that they come and give the information. Bank officers visit senior citizens who can’t make it to the bank,” he says.

Difficult trip

With the pandemic scare still in the air, and problems related to age and mobility, senior citizens are finding the procedure difficult to
follow.

Sixty-year-old Ramesh Ramanathan, a retired engineer, found his savings account, used for 50 years with no hitch, blocked.

“I got a call from the bank asking me to come over and upgrade the KYC details. I had to request a neighbour to watch over my wife, paralysed for over a year, while I went to go to the bank to fill in the details. We live alone and commuting in traffic is just beyond me now,” he says.

Rukmini Rao, 70, who lives in Rajajinagar, says, “The pandemic is not over yet and insisting that people should appear in person to submit KYC details is not right. The chances of contracting infection is high, especially for elderly people.”

Suresh Kumar, a filmmaker, has been travelling. “It is impossible for me to go to my branch. So I have just let things be,” he says.

Be wary of SMS links

Frauds are cashing in on the opportunity and sending fake alerts, warns Kapil Gupta, director of Volon Cyber Security, a company that occasionally assists the police in investigation of cyber crimes.

“The SMSes sometimes look genuine. Gullible customers, in a rush to submit their details, end up clicking on random links and filling in personal information,” he says. He urges customers to cross-check with the bank’s relationship manager before giving out personal information.

ID proof

You can carry any of the following documents to complete your KYC procedure:

Driving licence

Aadhaar card

Voter ID

PAN card