Reserve Bank allows lenders to start Otp-based E-KYC account opening

THE RESERVE Bank of India (RBI) has decided to allow one-timepin (OTP) based E-KYC (electronic know your customer) for opening bank accounts.

“A regulated entity (bank) may provide an option for onetime-pin (OTP) based E-KYC process for on-boarding of customers,” the RBI said in a notificationtobanks.whileopeningsuch accounts, there must be a specific consent from the customer for authentication through OTP, the RBI said. “The aggregate balance of all the deposit accounts of the customer should not exceed Rs 1 lakh,” the RBI said.

Similarly, the aggregate of all credits in a financial year, in all the deposit taken together, should not exceed Rs two lakh. As regards borrowal accounts, only term loans shall be sanctioned. The aggregate amount of term loans sanctioned should not exceed Rs 60,000 in a year, the RBI said.

“Accounts, both deposit and borrowal, opened using OTP based E-KYC should not be allowed for more than one year within which customer due diligence (CDD) procedure as provided Section 17 of the Principal Direction is to be completed ...,” the central bank said.