Latest news with #MasterDirection
Mint
13-06-2025
- Business
- Mint
Did not operate your bank account for 10 years? RBI revises rules on inoperative bank accounts. Check latest rules
The Reserve Bank of India (RBI) has updated its rules with regards to inoperative accounts/ unclaimed deposits in banks. The latest instructions which will be called Inoperative accounts/ unclaimed deposits in banks - Revised instructions (Amendment) 2025 will come into force with immediate effect. As of now, the credit balance in any deposit account maintained with banks, which have not been operated for ten years or more, or any amount remaining unclaimed for ten years or more are meant to be transferred by banks to DEA fund maintained by the Reserve Bank of India (RBI). The DEA fund is meant to be used for promotion of depositors' interests and for such other purposes which may be necessary for the promotion of depositors' interest as may be specified by the RBI on a regular basis. The latest guidelines released on June 12 list out three points. First is that the bank will make available the facility of updation of KYC for activation of inoperative accounts and unclaimed accounts at all branches including non-home branches. Second is that the updation of KYC will also include video identification i.e., video customer identification process. Third is that the bank may even use the facilities of authorised business correspondent for activation of inoperative accounts. 'A bank shall make available the facility of updation of KYC for activation of inoperative accounts and unclaimed deposits at all branches (including non-home branches). Further, a bank shall endeavour to provide the facility of updation of KYC in such accounts and deposits through Video-Customer Identification Process (V-CIP),' reads RBI circular. 'The V-CIP related instructions under Master Direction - Know Your Customer (KYC) Direction, 2016 dated February 25, 2016 (as updated from time to time) shall be adhered to by the bank. Additionally, the services of an authorised Business Correspondent of the bank may be utilised for activation of inoperative accounts as prescribed in paragraph 38(a) (iia) of the above Master Direction,' it reads further. For all personal finance updates, visit here
Time of India
12-06-2025
- Business
- Time of India
Major relief in KYC updation in your bank account: RBI empowers BCs to update KYC
What did the RBI say about the change in KYC updation process? Academy Empower your mind, elevate your skills 1. Use of Business Correspondent (BC) by banks for Updation/ Periodic Updation of KYC Self-declaration from the customer in case of no change in KYC information or change only in the address details may be obtained through an authorized BC of the bank. The bank shall enable its BC systems for recording these self-declarations and supporting documents thereof in electronic form in the bank's systems. The bank shall obtain the self-declaration including the supporting documents, if required, in the electronic mode from the customer through the BC, after successful biometric based e-KYC authentication. Until an option is made available in the electronic mode, such declaration may be submitted in physical form by the customer. The BC shall authenticate the self-declaration and supporting documents submitted in person by the customer, and promptly forward the same to the concerned bank branch. The BC shall provide the customer an acknowledgment of receipt of such declaration /submission of documents. The bank shall update the customer's KYC records and intimate the customer once the records get updated in the system, as required under paragraph 38(c) of the Master Direction ibid. It is, however, reiterated that the ultimate responsibility for periodic updation of KYC remains with the bank concerned. 2. Due Notices for Periodic Updation of KYC The Regulated Entity (RE) shall intimate its customers, in advance, to update their KYC. Prior to the due date of periodic updation of KYC, the RE shall give at least three advance intimations, including at least one intimation by letter, at appropriate intervals to its customers through available communication options/ channels for complying with the requirement of periodic updation of KYC. Subsequent to the due date, the RE shall give at least three reminders, including at least one reminder by letter, at appropriate intervals, to such customers who have still not complied with the requirements, despite advance intimations. The letter of intimation/ reminder may, inter alia, contain easy to understand instructions for updating KYC, escalation mechanism for seeking help, if required, and the consequences, if any, of failure to update their KYC in time. Issue of such advance intimation/ reminder shall be duly recorded in the RE's system against each customer for audit trail. The RE shall expeditiously implement the same but not later than January 01, 2026. Why did RBI come up with this development about letting BCs conduct KYC? Other simplification measures taken by RBI about customer onboarding and updation/ periodic updation of KYC A. Face-to-face mode for onboarding the customer Customer may be onboarded in face-to-face mode through Aadhaar biometric based e-KYC authenticating and, in such case, if customer wants to provide a current address, different from the address as per the identity information available in the UIDAI database (i.e., Central Identities Data Repository), he may give a self-declaration to that effect to the RE (ref. paragraph 16 of the Master Direction on KYC). Further, Digital KYC process is also allowed for customer onboarding. B. Non-face-to-face (NFTF) modes for onboarding the customer Consent-based onboarding of customers in NFTF mode may be done using Aadhaar OTP based e-KYC authentication which is subject to certain conditions (ref. paragraph 17 of the Master Direction on KYC). Further, such account shall be placed under strict monitoring, and Customer Due Diligence (CDD) procedure shall be completed within a year. Customer onboarding in NFTF mode using digital modes such as KYC Identifier, equivalent e-documents, documents issued through DigiLocker, and non-digital modes such as obtaining copy of OVD certified by additional certifying authorities as allowed for NRIs and PIOs are subject to certain conditions. C. Customer onboarding using Video based Customer Identification Process (V-CIP) V-CIP is an alternate method of CDD by an authorised official of the RE by undertaking seamless, secure, live, informed and consent based audiovisual interaction with the customer to obtain identification information required for CDD purpose V-CIP is treated on par with face-to-face onboarding. D. Simplified process of updation and periodic updation of KYC Self-declarations - REs are allowed to obtain self-declaration regarding 'no change in KYC information' or 'a change only in address details' from customers using digital and non-digital modes, through customer's email / mobile number registered with the RE, ATMs, digital channels (such as online banking / internet banking, mobile application of RE), letter, BCs, etc. The updation/ periodic updation of KYC records are allowed to be carried out at any branch of the RE with which the customer maintains the account. Aadhaar OTP based e-KYC and V-CIP are permitted for the purpose of updation/ periodic updation of KYC. The REs have been directed to update customers' KYC information/ records based on the update notification received from CKYCR. The Reserve Bank of India (RBI) has amended two processes related to know your customer ( KYC ) norms for ease and convenience of banking customers. In a notification dated June 12, 2025, the RBI said that now banking correspondents (BCs) are permitted to conduct updation or periodic updation of KYC. Similarly the RBI also said that banks have to give at least three advance intimations including at least one intimation by letter to customers for complying with the periodic KYC updation to give you a context, banking correspondents are NGOs, self-help groups (SHGs), micro finance institutions (MFIs) and other civil society organisations (CSOs) who are contracted by the bank to act as its agent. Your local kirana shop owner can also empannel as a BC, if he has got the necessary permission from the to the Union Bank of India website: 'Business Correspondent is an extended arm of the Bank Branch who is providing Financial and Banking services to the customers in unbanked and underbanked areas.'The RBI said in the notification:The RBI said in the notification:The RBI said this new development will help many customers and what prompted this new development was the fact that many people faced issues with their periodic KYC updation. This delay in KYC updation, resulted in delay in various services like direct benefit scheme, scholarships, etc.'The Reserve Bank has observed a large pendency in periodic updation of KYC including in the accounts opened for credit of Direct Benefit Transfer (DBT)/ Electronic Benefit Transfer (EBT) under Government schemes to facilitate credit of DBTs and/ or scholarship amount (DBT/ EBT/ scholarship beneficiaries) and accounts opened under PMJDY,' said the RBI in the RBI said: 'The banks are advised to organize camps and launch intensive campaigns including special camps, focusing on periodic updation of KYC, especially in rural and semi urban branches and the branches having large pendency in periodic updation of KYC. The banks may also facilitate the process of activation of such accounts by taking an empathetic view as indicated in the circular dated December 2, 2024.'According to the annexure in the notification, here are the steps taken by the RBI for simplifying the KYC process:The processes of onboarding customer and updation/ periodic updation of KYC have been simplified and the same are given below:
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Business Standard
29-05-2025
- Business
- Business Standard
How Sebi fixed ₹20 cr disgorgement in IndusInd Bank insider trading case
The market regulator on Wednesday asked five senior IndusInd Bank officials, including former deputy CEO Arun Khurana and former CEO Sumant Kathpalia, to disgorge around ₹20 crore for alleged insider trading. Khurana has to disgorge ₹14.4 crore, Kathpalia ₹5.21 crore, and others amounts ranging from ₹4 lakh to ₹7 lakh. Here's how the Securities and Exchange Board of India (Sebi) arrived at these figures: IndusInd Bank on March 10 disclosed losses in its derivative portfolio, estimating an adverse impact of 2.35 per cent of its net worth of around ₹1,530 crore (as of December 2024). The bank's stock fell 27.2 per cent the next day: from ₹901 to ₹656. Sebi investigation Following the disclosure and stock crash, Sebi initiated a suo motu investigation to identify trades made with unpublished price-sensitive information (UPSI) related to the derivative losses. The regulator examined records from NSE, BSE, depositories, KPMG, and IndusInd Bank, focusing on the period from September 12, 2023 to March 10, 2025. Why September 2023? Sebi's probe revealed that following the Reserve Bank of India's Master Direction (Classification, Valuation and Operation of Investment Portfolio of Commercial Banks) on September 12, 2023, IndusInd formed an inter-departmental team by September 26 to address derivative accounting issues. At the team's first meeting on September 26, discrepancies in the accounting of derivative contracts were identified, prompting the bank to calculate unreported losses. Who traded before the crash? Also Read Sebi identified individuals who were aware of the derivative loss discussions and traded IndusInd shares during the UPSI period. On December 4, 2023, Khurana sold 348,500 shares to net ₹53 crore. Kathpalia sold 125,000 shares, earning ₹19.2 crore. The three other individuals sold smaller quantities around the same time. Sebi noted that none of these individuals had submitted a trading plan for FY24 or FY25, which would have indicated pre-planned sales unrelated to UPSI. Sebi, in a 32-page interim order, concluded that these individuals traded while aware of the UPSI, thereby avoiding significant losses. 'It would be naive to assume the noticees traded routinely while discussions on discrepancies with a substantial financial impact were ongoing,' said the order. Calculating disgorgement amount Sebi calculated the disgorgement based on losses avoided due to the 27.2 per cent stock price drop post-disclosure. Had the individuals sold their shares after the UPSI became public, their proceeds would have been 27.165 per cent lower, the regulator has held. Thus, Sebi multiplied the number of shares sold by each individual by this percentage to determine the loss avoided, which formed the disgorgement amount. Kathpalia's 125,000 shares sold for ₹19.2 crore and 27.165 per cent of it comes to ₹5.21 crore.
The Print
29-05-2025
- Business
- The Print
Sebi bans IndusInd Bank former CEO, 4 others from securities mkt for insider trading
The other officials of IndusInd Bank Ltd (IBL) restrained by Sebi are Arun Khurana, who was Executive Director and Deputy CEO at the time of the alleged violation; Sushant Sourav, Head, Treasury Operations; Rohan Jathanna, Head, GMG Operations; and Anil Marco Rao, Chief Administrative Officer (CAO), Consumer Banking Operations. In addition to the market ban, Sebi has impounded Rs 19.78 crore collectively from the five individuals, according to an interim order passed by the regulator. New Delhi, May 28 (PTI) Markets regulator Sebi on Wednesday barred former CEO of IndusInd Bank, Sumant Kathpalia, and four other senior officials from accessing the securities markets in connection with an alleged insider trading in the bank's shares. These senior executives allegedly traded in IndusInd Bank shares while in possession of unpublished price-sensitive information (UPSI) related to discrepancies in account balances of the bank's derivative portfolio. By doing so, they violated insider trading regulations. 'During the preliminary examination conducted by Sebi, on the basis of the evidence collected so far, it is prima facie seen that all noticees traded in the scrip being aware of the UPSI related to the discrepancies and averted/avoided huge losses,' the regulator said in its 32-page order. The case originated from a Master Direction issued by the Reserve Bank of India (RBI), which had a significant operational and financial impact on IndusInd Bank. Sebi noted that the internal team of the bank was aware of the financial implications due to discrepancies in the derivative portfolio and had already begun calculating the impact internally. A preliminary examination revealed that an email dated November 30, 2023, was sent by the Head, Accounts, of the bank to certain employees. This communication cited a figure of Rs 1,749.98 crore as the estimated impact of discrepancies in the derivative portfolio. Further, during the preliminary examination, it is prima facie seen that members of the senior management of IBL including noticees (five officials) were aware of the UPSI related to discrepancies and they had kept constant supervision upon the same. The evidence analysed during the preliminary examination revealed that Noticees traded in the scrip of IBL while being insider, Sebi said. Sebi noted that emails dated December 6, 7, and 8, 2023, referenced a discrepancy of around Rs 1,362 crore, with the final figure of Rs 1,572 crore communicated to certain employees on December 11, 2023. The examination also revealed that figures regarding the discrepancies were not only being tracked internally but were also being prepared for submission to the RBI. Emails circulated on December 16, 2023, March 6, 2024, and May 5, 2024, indicated discrepancy figures of Rs 1,572 crore, Rs 1,776.49 crore, and Rs 2,361.69 crore for the quarters ended September 2023, December 2023, and March 2024, respectively. However, this information was only disclosed to the public via stock exchange filings on March 10, 2025, Sebi noted. It was also noted that senior management insisted on getting these figures validated externally. Accordingly, KPMG was appointed in January 2024, to review the discrepancies identified by the internal team. The preliminary examination revealed that KPMG submitted a figure of Rs 2,093 crore as the negative impact from the discrepancies, covering data till December 31, 2023. In its order, Sebi noted that noticee nos. 1 to 5 (five officials) traded in the scrip of IBL while being insider and accordingly barred them 'from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, until further orders.' On April 29, CEO Kathpalia and Deputy CEO Khurana resigned from the bank. Following their exit, the IndusInd Bank Board appointed a Committee of Executives to oversee daily operations until a new MD & CEO takes charge or for a period of three months, whichever is earlier. The fraud-hit private sector lender earlier this month reported a Rs 2,329 crore loss for the March quarter, its worst performance ever, as the interim management opted to go for a deep-clean exercise beyond recognising the impact of wrong accounting practices. In the March quarter, the bank took impact of all the irregularities brought to the notice, including a Rs 1,960 crore hit from incorrect recognition of derivative trades, cumulative interest income reversal of Rs 674 crore due to incorrect accounting, disclosed a Rs 172 crore fraud where employees had led it to incorrectly classify the amount as fee income under the microfinance business, set off Rs 595 crore of incorrect manual entries posted as 'Other Assets' and 'Other Liabilities' in the past, and also recognized the higher slippages. The internal audit report of the bank revealed 'involvement of senior Bank officials, including former Key Management Personnel (KMP), in overriding key internal controls'. The bank reported the likely involvement of senior management in the accounting fraud to the Central Government. PTI SP DP MR MR This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
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Business Standard
29-05-2025
- Business
- Business Standard
How Sebi fixed ₹20-cr disgorgement in IndusInd Bank insider trading case
The market regulator on Wednesday asked five senior IndusInd Bank officials, including former deputy CEO Arun Khurana and former CEO Sumant Kathpalia, to disgorge around ₹20 crore for alleged insider trading. Khurana has to disgorge ₹14.4 crore, Kathpalia ₹5.21 crore, and others amounts ranging from ₹4 lakh to ₹7 lakh. Here's how the Securities and Exchange Board of India (Sebi) arrived at these figures: IndusInd Bank on March 10 disclosed losses in its derivative portfolio, estimating an adverse impact of 2.35 per cent of its net worth of around ₹1,530 crore (as of December 2024). The bank's stock fell 27.2 per cent the next day: from ₹901 to ₹656. Sebi investigation Why September 2023? Sebi's probe revealed that following the Reserve Bank of India's Master Direction (Classification, Valuation and Operation of Investment Portfolio of Commercial Banks) on September 12, 2023, IndusInd formed an inter-departmental team by September 26 to address derivative accounting issues. At the team's first meeting on September 26, discrepancies in the accounting of derivative contracts were identified, prompting the bank to calculate unreported losses. Who traded before the crash? Sebi identified individuals who were aware of the derivative loss discussions and traded IndusInd shares during the UPSI period. On December 4, 2023, Khurana sold 348,500 shares to net ₹53 crore. Kathpalia sold 125,000 shares, earning ₹19.2 crore. The three other individuals sold smaller quantities around the same time. Sebi noted that none of these individuals had submitted a trading plan for FY24 or FY25, which would have indicated pre-planned sales unrelated to UPSI. Sebi, in a 32-page interim order, concluded that these individuals traded while aware of the UPSI, thereby avoiding significant losses. 'It would be naive to assume the noticees traded routinely while discussions on discrepancies with a substantial financial impact were ongoing,' said the order. Calculating disgorgement amount Sebi calculated the disgorgement based on losses avoided due to the 27.2 per cent stock price drop post-disclosure. Had the individuals sold their shares after the UPSI became public, their proceeds would have been 27.165 per cent lower, the regulator has held. Thus, Sebi multiplied the number of shares sold by each individual by this percentage to determine the loss avoided, which formed the disgorgement amount. Kathpalia's 125,000 shares sold for ₹19.2 crore and 27.165 per cent of it comes to ₹5.21 crore. The smaller amounts for the other three individuals were similarly calculated.
