In a directive issued on Friday, NRB has said customers opening bank accounts need not submit citizenship copies of family members spanning three generations. [break]
“They should only provide citizenship numbers of their family members like husband or wife, father, mother, grandfather, grandmother, son, daughter, daughter-in-law and father-in-law,” says the directive.
“These numbers can be submitted at a later date, if they are not available at the time of opening an account at banks and financial institutions.”
But if any of the family members is dead or has not obtained a citizenship, such numbers need not be provided at all, the directive says. This is the same for those who have obtained a share of family property and are living on their own.
“However, the latest changes are only meant for low-risk customers,” NRB directive clarifies. This means ´high-risk clients´ like political figures and high-ranking government and corporate officials still need to submit citizenship copies of their family members spanning three generations.
Earlier in February 2012, when NRB first issued a directive on ´know your customers´, the regulator had made it mandatory for those opening bank accounts to submit citizenship copies of family members spanning three generations.
The measure - aimed at keeping a tab on unusual or suspicious transactions that aids financial crimes like money laundering and terror financing - was criticized by many financial institutions as being unpractical, as they said it would discourage people to open accounts.
Although the latest revision made by NRB is expected to provide some relief to customers, the Nepal Bankers´ Association (NBA), the umbrella organization of commercial banks, still is not happy and has called the changes as “half-hearted”.
“We have long been demanding that the central bank allow customers to open bank accounts upon submission of copy of their citizenship or passport,” NBA President Rajan Singh Bhandari told Republica. “Lengthy terms and conditions would only cause inconvenience to customers and discourage them from opening accounts.”
However, central bank has said it would not compromise on issues that could provide breeding ground for financial crimes like money laundering and terror financing.
“Customers should not hesitate in providing such information as these would help us curb criminal activities,” NRB Spokesperson Bhaskar Mani Gyawali said.
These changes should fully come into effect by mid-July, the NRB directive says.
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