The RBI (Reserve Bank of India) has already issued its notification for the payments banks in the country. The KYC (Know Your Customer) regulations have been made even more stringent. Payments banks are required to ensure that all customers of the mobile phone companies should adhere to KYC norms. KYC, if conducted by any telecom company which is a promoter group entity/promoter of the payments bank, should be of the same levels as that of any bank. Payment banks can get KYC information of clients from telecom companies only upon the consent of the customer.
This was the previous stance adopted by the Reserve Bank of India. Now, however, it has directed that telecom companies which do not find place in Reporting Entities as per the PML Act terms will not be subject to the requirements of the same. As a result, it is not permitted to rely on the KYC conducted by the telecom companies. The RBI has directed payments banks to adhere to the RBI Master Direction on KYC which is amended periodically for all customers including existing customers of the telecom companies.
KYC done for customers of payments banks who are on-boarded via telecom operators and the promoters will be considered absolutely null and void. Revised KYC is required to be conducted for all these customers in the future. This new development backs up allegations of Airtel setting up payments bank accounts of its mobile customers minus any consent. UIDAI also fined Airtel Rs. 2.5 crore in December, 2017 for this reason. Telecom operators will be bearing the brunt of these new RBI guidelines.
Paytm claims to have finished KYC for almost 55 million wallet customers in India. Paytm has also stated that KYC operations will be boosted with an investment of $500 million. Telecom operators that have payments bank licenses include mPesa, Jio and Airtel. RBI last year had revised these guidelines on operations of digital wallets in India. It had directed that wallets have to be KYC-adherent with the minimum compliant wallets being mandated to be fully compliant within a period of 12 months.
Industry reports state that costs of one Aadhar enabled KYC can vary between Rs. 70-300 depending on the technological efficiencies of these players. Some also claim that cost of document collection for KYC can range between Rs.100-250 for a single individual.