The Reserve Bank of India has imposed a penalty of ₹3 crore on Union Bank of India for non-compliance with the regulatory direction on ‘know-your-customer’ (KYC) norms.
KYC is a process by which banks obtain information about the identity and address of customers.
This process helps to ensure that banks’ services are not misused. The KYC procedure is to be completed by the banks while opening accounts. Banks are also required to periodically update their customers’ KYC details.
These actions are based on deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.