Follow KYC norms or face regulatory action, banks told

RBI Deputy Governor Swaminathan J has asked banks to follow KYC guidelines with both “precision and empathy”, failing which regulatory actions will be taken against them by the central bank.

Addressing a Conference of Directors of Private Sector Banks here on Monday, the Deputy Governor also expressed concern that in many cases, customer grievance mechanisms, including the Internal Ombudsman structure, are treated more as a formality than as a robust, effective resource.

The Internal Ombudsman mechanism should be more than words on paper; it should operate with the spirit and diligence necessary to resolve issues impartially and promptly, he said.

Bank boards, he said, should work towards building customer-centric banks.