Circular No. RBI/2023-24/25 DOR.AML.REC.13/14.01.001/2023-24; dated: … Continue reading “RBI updates KYC instructions on wire transfer to align with FATF recommendation”
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Circular No. RBI/2023-24/25 DOR.AML.REC.13/14.01.001/2023-24; dated: 04.05.2023
Earlier, the RBI issued Master Direction on KYC dated February 25, 2016, in terms of which Regulated Entities (REs), had to undertake certain measures while dealing with Wire Transfers.
Now, the RBI has updated the instructions in the Master Direction on KYC related to Wire Transfers in order to align the same with the relevant recommendation of the Financial Action Task Force (FATF).
The RBI has instructed banks and financial institutions to ensure that cross-border as well as domestic wire transfers contain complete information about the originator and beneficiary.
As per the updated Master Directions, all cross-border wire transfers must be accompanied by accurate, complete, and meaningful originator and beneficiary information which is as follows –
(a) name of the originator;
(b) the originator account number where such an account is used to process the transaction;
(c) the originator’s address, or national identity number, or customer identification number, or date and place of birth;
(d) name of the beneficiary; and
(e) the beneficiary account number where such an account is used to process the transaction.
Further, domestic wire transfer, where the originator is an account holder of the ordering RE, shall be accompanied by the originator and beneficiary information, as in the case of cross-border wire transfers.
“Cross-border wire transfer” refers to any wire transfer where the ordering financial institution and beneficiary financial institution are located in different countries. This term also refers to any chain of wire transfer in which at least one of the financial institutions involved is located in a different country.
“Domestic wire transfer” refers to any wire transfer where the ordering financial institution and beneficiary financial institution are located in India. This term, therefore, refers to any chain of wire transfer that takes place entirely within the borders of India, even though the system used to transfer the payment message may be located in another country.
The amended instructions are provided as an annexure to the circular. The circular shall be effective immediately.
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