Indicating its seriousness in utilising the Unique Identity (UID) as a key to financial inclusion, the government is mulling amendments to the Prevention of Money Laundering Act (PMLA) to include UID as proof of identity for mandatory Know-Your-Customer (KYC) norms by reporting entities such as banks.
The Unique Identity Authority of India (UIDAI) is in talks with the finance ministry to make necessary amendments to the PMLA, sources told The Indian Express. UIDAI officials are expected to meet finance ministry officials this week regarding the amendments. “The PMLA requires banks and other reporting entities to maintain a KYC record of all its customers. The amendment of PMLA is essential to make UID as a KYC detail,” the sources said.
According to the current practice under the PMLA, reporting entities — including banking company, financial institution, co-operative banks, housing finance institutions and non-banking financial companies — have to maintain client identification details. While an individual requires to furnish identification documents issued by government authorities — like a PAN, passport, voter’s ID, driving licence, defence ID card or photo ration card — for non-individual accounts of companies, various other documents are required.
courtesy : shruti sreevastava & www.indianexpress.com
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