In the near future, banks may be able to do away with the “know your customer” process. This is a possibility once a sizeable chunk of population gets a Unique Identification number. Addressing the press after attending a meeting organised by the Reserve Bank of India (RBI) on Friday on using UID for financial inclusion, a top public sector bank official said that, once the UID number of a person was activated, banks could do away with KYC norms for small-value, or no-frills, accounts.
During the meeting, The Unique Identification Authority of India Chairman, Nandan Nilekani, made a presentation on how UID could help expedite the financial inclusion process. The meeting was attended by Who’s who of the banking fraternity such as SBI Chairman OP Bhatt; MD and CEO of ICICI Bank, Chanda Kochhar; MD and CEO of HDFC Bank Aditya Puri; and Chairman and MD of Punjab National Bank KR Kamath.
While the proposed scheme will bring a large measure of relief to banks, development of the UID database is going to be a long-drawn process in a country like India with its one billion-plus population.
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