RBI makes KYC more stringent for domestic money transfers

New Delhi: The Reserve Bank has revised the extant regulatory framework guiding domestic money transfer services by making the know your customer (KYC) record requirements stringent after a review of the current framework guiding various payments and money transfer services.

In the new framework issued Wednesday, the RBI wants the remitting bank to obtain and keep a record of the name and address of the beneficiary for cash payout.

In a communication to authorised payment system operators, the central bank said every transaction by a remitter should be validated by an additional factor of authentication (AFA).

Domestic money transfer roles were introduced in 2021 and since then, there has been a significant increase in the availability of banking outlets, developments in payment systems and ease in fulfilling KYC requirements. Now users have multiple digital options for funds transfer, the regulator said.