In a relief to thousands of migrant workers and employees with transferable jobs, the Reserve Bank of India has said that a bank account can be opened with just one address proof, which can be either permanent or local.
The banks, if they need to check the address, can do so from a variety of sources including a receipt of a registered letter to even a “telephonic conversation”. The relief makes the dream of walking into a bank and opening an account with just personal identification a reality for even the poorest of the citizens. Recently, the RBI had allowed minors of ten years and above to open full fledged bank accounts in their name independently.
“Henceforth, customers may submit only one documentary proof of address (either current or permanent) while opening a bank account or while undergoing periodic updation,” the RBI said. This means a person from, say Bihar can open a bank account in Kerala using the address proof in his home state. Hitherto, banks used to insist on address proof of the place where the customer is residing.
Essentially, the RBI has declared it will not bother with checking address proof once another agency, usually the government, has issued a certificate. The Damodaran committee on customer service in banks, which submitted its report to the RBI in August 2011, had suggested simplification on these lines.
“The poorer sections of people, migrants etc., with whom the committee interacted in different places in the country, desired a simple account which can be opened with a self attested photograph and address proof. This account may be upgraded to a basic account if the customer fulfills Know your customer (KYC) requirements. Wherever UID (unique identification) is introduced, it should be possible to open a no-frills account purely on the basis of (Aadhaar) with necessary validation.
The RBI has gone one step further, after a delay of three years. It has done away with even the requirement of producing an Aadhaar certificate in such cases.
According to the central bank, in case a proof of address furnished by the customer is not the local address or the address where the customer is currently residing, the bank may take a declaration of the local address on which all correspondence will be made by the bank with the customer. “No proof is required to be submitted for such address for correspondence/local address” the RBI notification to banks read.
The address may be verified by the bank through ‘positive confirmation’ such as acknowledgment of receipt of letter, cheque books, ATM cards, telephonic conversation or visits. In the event of change in this address due to relocation or any other reason, customers may intimate the new address for correspondence to the bank within two weeks of such a change, it said.
The RBI decision will help migrant workers and employees with transferable jobs, who at present, face cumbersome procedure to access banking services. It was receiving representations and references from various quarters, including migrant workers, transferred employees about the problems faced by them in submitting a proof of address while opening a bank account, the notification said.