Banks to now match original IDs with photocopies: PMLA

Oct 23, 2017 10:59 IST
Original ID must for transaction above Rs. 50000

The Government has set a mandatory rule for banks and financial institutions (FIs) to check the original identification documents of individual person dealing in cash above the prescribed threshold of fifty thousand rupees, to tackle the use of forged or fake copies.

The notification was issued by the Department of Revenue in the Finance Ministry by making an amendment to the Prevention of Money-laundering (Maintenance of Records) Rules (PMLA).

About PMLA

The Prevention of Money Laundering Act (PMLA) is put in place to combat black money generation and money laundering in India.

The new rules notified under PMLA compel the entities like financial institutions (FIs), banks and other intermediaries to confirm identity of individuals, preserve records and provide information to Financial Intelligence Unit of India (FIU-IND).

It also makes its rules obligatory for the entities like stock broker, cooperative bank, chit Fund Company, non-banking finance companies and housing finance institution.

Highlights of notification

The notification under this rules requires to produce Biometric identification number Aadhaar and other official documents to the reporting offices for opening a bank account as well as for any financial transaction of Rs 50,000 and above.

It also mentions to produce the same document for all cash dealing of more than Ten lakh rupees or its corresponding in foreign currency, cash transactions where forged or counterfeit currency notes have been used and all suspicious transactions.

All foreign transfers of more than Five lakh rupees in foreign currency and sale and purchase of immovable property valued at Fifty lakh rupees or more also fall under this new rules.


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