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RBI Revised Domestic Money Transfer Framework

Published on July 27, 2024
Current Context: On 24th July 2024, The Reserve Bank of India (RBI) issued a new framework on Domestic Money Transfer (DMT) for regulated firms, making stricter Know Your Customer (KYC) record standards, focusing on banking services and payment systems.
RBI Revised Domestic Money Transfer Framework
  • These updated guidelines will come into effect from November 1, 2024.
  • The changes aim to enhance the security of domestic money transfers within India.
  • Here are some key points:
    • Cash Pay-out Service: Remitting banks will now obtain and maintain records of the name and address of the beneficiary for cash payouts.
    • Cash Pay-in Service: Remitting banks or Business Correspondents (BCs) will verify the remitter using a verified mobile phone number and a self-certified ‘Officially Valid Document (OVD)’ as specified in the Master Direction - Know Your Customer Direction 2016.
    • Additional Factor of Authentication (AFA): Every transaction by a remitter must be validated by an AFA.
    • Income Tax Act Compliance: Remitting banks and their BCs must follow the provisions of the Income Tax Act of 1961 regarding cash deposits.

Question:

1 How will remitters be verified for cash pay-in services under the new Domestic Money Transfer framework?

  • A) With a verified mobile number and an OVD
  • B) With a PAN card and Aadhaar card
  • C) With a passport and driving license
  • D) With a fingerprint and iris scan
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