Nepal eases KYC procedures
The Government of Nepal has announced a significant reform in its banking sector by streamlining the Know Your Customer (KYC) process. The newly issued “Anti-Money Laundering Regulations, 2081” allows banks and financial institutions to directly access customer information from the National ID system.
Under the new regulations, banks can electronically verify customer identities by pulling necessary data from government digital records. This includes name, gender, age, citizenship details, and contact information. Customers must provide their citizenship or national ID card number to facilitate this process.
To address privacy concerns, the government will oversee the data-sharing process. Banks can only access additional personal information with explicit customer consent. The Ministry of Home Affairs or the National ID Department will be responsible for managing and sharing the required information.
This new system offers several benefits, including increased efficiency for banks, enhanced security, and greater convenience for customers. Banks can now verify customer identities more efficiently, reducing processing time. Additionally, direct access to government databases minimizes the risk of fraud. For customers, the new system eliminates the need to fill out lengthy KYC forms for each account.
Nepal Rastra Bank has confirmed that banks will soon receive updated guidelines on implementing the digital KYC process. This reform is expected to modernize Nepal’s financial sector and improve the overall customer experience.