Finmin pitches for enhanced KYC, due diligence for merchants, business correspondents
Finance ministry stresses rigorous KYC and due diligence to prevent financial frauds, focusing on data security, safeguarding the financial ecosystem, and blocking fraudulent micro ATMs. Recommendations were discussed at an inter-ministerial meeting.
In a bid to check incidence of financial frauds, the has made a case for an enhanced procedure and extensive due diligence by banks and financial institutions for onboarding to safeguard customers against cyber risks, sources said.Appropriate due diligence of merchants and (BCs) who offer banking services in rural and remote areas is necessary not only to check frauds but also to fortify the financial ecosystem, sources said. According to sources, there is a need to strengthen data security and data protection at the level of merchants and BCs as chances of compromise are higher at that level.
Therefore, sources said, may advise banks and financial institutions to review the concentration of BCs in cyber fraud hotspots and their onboarding, blocking of micro ATMs found to be involved in frauds. This was one of the suggestions made at an inter-ministerial meeting held recently, sources said.
Source: Stocks-Markets-Economic Times
