Page 5 - Banking Finance March 2022

BANK UPDATE

Banking News

Banks, finance companies years. Besides this, dormant and inac- laboration with SCUBE Capital, a glo-
tive accounts also require fresh KYC bal fund management company based
will freeze Non KYC-com- updates to unfreeze or reactivate the out of Singapore.

pliant Bank account accounts. Although for most customers NRI and resident customers of Federal
the requirement is to update only once
Many customers of banks and other Bank can invest in this fund that offers
financial services who have not up- in 10 years, bankers say that more fre- a portfolio return (IRR) guidance of ~
quent updates are required because in
dated their identity and address proof $6.50% per annum with a fund tenor
documents might find their accounts some cases the documents submitted of three years from the date of fund
might not be part of the list of official
frozen in the new year. The reason: On closure with an option to extend by
December 31, 2021, the Reserve Bank valid documents. Also, where custom- one year. The portfolio is managed by
ers have changed the account and the
of India's freeze on action by banks a highly skilled team with a cumulative
against customers who have not com- communication returned to the bank, experience of over 70 years in manag-
the KYC would have to be done afresh.
plied with know your customer (KYC) ing investments of over $50 billion.
norms will come to an end. In a circular to all banks on May 2021, Speaking on the occasion, Shalini
the RBI had said, "Keeping in view the
At any given point, there are hundreds Warrier, executive director & Business
current Covidrelated restrictions in vari-
of customers whose KYC validity ex- Head - Retail, Federal Bank said, "The
ous parts of the country, regulated
pires. However, there could be a offer has been specially curated by our
entities are advised that in respect of
bunching-up of action as the RBI had the customer accounts where periodic partner, Equirus Wealth along with
asked banks not to insist on KYC in the SCUBE Capital and is only available to
updating of KYC is due and pending as
wake of the second wave of the pan- Federal Bank customers."
on date, no restrictions on operations
demic. The requirement of updating Ajay Garg, managing director - Equirus
of such account shall be imposed till
KYC norms is not just for banks but December 31, 2021, for this reason Group, said, "the product offers attrac-
every regulated financial entity as it is tive risk-adjusted returns given the low
alone, unless warranted under instruc-
part of anti-money laundering laws. debt yield environment. While this is
tions of any regulator/enforcement
This includes finance companies, mu- our first exclusive product for Federal
agency/court of law."
tual funds, broking houses and deposi- Bank clients, we are very keen to cre-
tories. ate a pipeline of such exclusive offer-
Fed Bank launches $-off- ings going forward."
Bankers said that for customers in low-
risk accounts, KYC needs to be updated shore fund Hemant Mishr, co-founder and CEO,
once every 10 years. However, those Federal Bank and Equirus Wealth have Asset Management, SCUBE Capital,
classified as high-risk will need to up- together launched a 'US dollar offshore Singapore, added that "The fund has
date their account once every two fund' for their customers. This is in col- been jointly designed with inputs from

BANKING FINANCE | MARCH | 2022 | 5