Opening a bank account becomes a cakewalk
The first step one takes when entering the world of money is opening a bank account. When you bagged your first job, how would you receive your salary from your employer? You needed a bank account. In fact most corporates open savings accounts for their employees, wherein their salary is directly credited to their bank account. You want to open a bank account with the nearest branch. Here’s the good news. You no longer need to go through the mind-numbing procedure of opening an account any more. Earlier, trying to open an account would legitimately take 6-12 months off your life, if you add up the time wasted and the stress associated with it. In addition to this, you would have to practice writing your signature exactly the same way forever for the rest of your life, else your signature would not be considered valid and transactions would be rendered failed. But now with new government norms, opening an account is fairly simple and easy.
KYC process simplified further
The Reserve Bank of India (RBI) has revised the list of documents that can be used as proof of identity and address to open a bank account. Earlier, one had to submit separate proofs for identity and address for KYC, whereas now a single document with photograph and address of the applicant suffices. The following documents now serve as a proof of identity or address:
- Utility bills that are not older than two months
- Property or municipal tax receipts
- Bank account or post office savings account statements
- Pension or family pension payment orders for retired public sector employees
- Documents issued by listed companies as well as Indian or foreign governments that acknowledge an official place of residence in India.
Instead of a full time service account you can open a small account. This can be done by simply submitting a self-attested photograph and by giving your thumb impression on the application in the presence of a bank employee. These accounts have restrictions in terms of loans (a maximum of Rs 1 lakh a year), withdrawals (not more than Rs 10,000 a month) and maximum balances (Rs 50,000 at any point of time), but they are beneficial to students and migrant workers. These accounts are operational only for a year. However, if the account holder provides proof that he/she has applied for a valid KYC document, the account can be extended for a further period of 12 months.
Relaxation for low-risk customers
A person without valid KYC documents but considered as ‘low-risk’ can open an account by submitting any of the following: identity card with applicant’s photograph issued by a central/state government department, statutory/ regulatory authority, public sector undertaking, scheduled commercial bank or public financial institution; or, a letter issued by a gazetted officer with an attested photograph.
A ‘low-risk ‘customer, who is unable to submit KYC documents can do so within six months from the date of opening the account.
No separate proof for current address
If you recently moved to a new city and did not have a valid address proof, opening a bank account was nearly impossible. This is no longer a problem. Customers are required to submit only one address proof (current or permanent) for opening a bank account. Migrant workers and transferred employees, who have shifted their place of stay, for work can hugely benefit from this.
A person categorised as ‘low-risk’ and not having valid KYC documents can open an account by submitting any of the following:
- Identity card with applicant’s photograph issued by a central/state government department, statutory/regulatory authority, public sector undertaking, scheduled commercial bank or public financial institution;
- A letter issued by a gazetted officer with an attested photograph.
The new rules have made the procedure of opening a bank account less onerous. Open your account today!