The country’s apex Bank Reserve Bank of India advised Banks and NBFCs to carry out Money Laundering (ML) and Terrorist Financing (TF) risk assessment exercise at regular intervals.
- Under the master directions on KYC, the Regulator said that a new section has been added on KYC which instructs the Regulated Entities (Res) to carry out the said exercise periodically to identify, assess and take necessary effective steps to mitigate its money laundering and terrorist financing risk for their clients, countries or geographic areas, products, services and transactions or delivery channels.
- Also, the Regulator has advised that while conducting the exercise REs should take note of overall sector specific vulnerabilities if any, which the Regulator would share with REs from time to time.
- The internal risk assessment carried by the REs should be in accordance with its size, geographical presence, complexities of activities/structure.
The entities list regulated by RBI includes the following.
- All India Financial Institutions
- NBFCs and
- All Payment System Providers
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