To curb the cases of black money and money laundering, the Reserve Bank of India (RBI) has taken a major decision. According to the RBI, the name of the purchaser to be incorporated on the face of the demand draft, pay order, banker's cheques, etc, by the issuing bank will also be included from September 15, 2018. In the current form, only the name of a person in whose favour a DD is to be prepared is mentioned on it.
Many of such frauds are committed by finding loopholes in the banking instruments such as demand draft. With the government taking tough stance on corruption and bank-related frauds, the RBI too has stepped up security measures to curb illegal flow of money.
Reserve Bank of India hopes that this will bring transparency in the banking system. In this regard, the notification has been issued on Thursday. According to the notification, now whenever the bank makes a demand draft, pay order and bank check, it will also be mandatory to enter the name of the purchaser.
The Reserve Bank has also issued instructions in this regard to the banks, including all commercial banks, cooperative banks and district central cooperative banks. These banks have been clearly told that they have to implement this new rule from September 15, 2018.
RBI has amended the Know Your Customer (KYC) rules for this. This amendment has been done in section 66 of the KYC Master's Direction.
(Also read: RBI raises the limit of Home Loan of Priority Sector)
(Also read: [Hindi] RBI removes ban from Airtel Payments Bank, can make customers via e-KYC)
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