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SBI will not freeze accounts if KYC is not updated

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SBI will not freeze accounts if KYC is not updated

(This story originally appeared in on May 01, 2021)

MUMBAI: SBI has written to all it branches asking them to not summon their customers for updating KYC (know-yourcustomer) details. It has also asked them not to follow their usual practice of partially freezing accounts up to May 31, if KYC is not updated.

In its letter, SBI said that in cases where KYC is due, the bank can update records based on documents received from customers through post or registered email ID.

The communication by the country’s largest bank followed a tweet from finance minister Nirmala Sitharaman, who had flagged her ministry’s departments on the issue raised by a journalist.

Banks usually ask customers to update their KYC once every 10 years for low-risk customers, once every eight years for medium-risk and every two years for high-risk customers. The categorisation according to risk depends on the value and frequency of transactions. Salary accounts are usually safe. The move will benefit thousands of customers who have found their accounts frozen for want of KYC amid the pandemic.

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