Business

Centre tweaks rules to make inactive accounts functional

The Centre wants to ensure beneficiaries can withdraw cash without further documentation.

The Centre wants to ensure beneficiaries can withdraw cash without further documentation.   | Photo Credit: V.V. KRISHNAN

Aims to ensure cash transfer under COVID-19 relief reaches beneficiaries

The Finance Ministry has tweaked prevention of money laundering (PML) norms with the aim to make all inoperative accounts functional so that cash transfers by the government under the COVID-19 relief package can reach beneficiaries.

In a communique to banks, the Department of Financial Services has conveyed that in respect of the Pradhan Mantri Jan Dhan Yojana accounts, basic savings account and small accounts, those accounts which have become inoperative due to various reasons — including non-completion of know your customer (KYC) requirements or updation — rules have been amended with an aim ‘to avoid any difficulty caused to poor people and beneficiaries of PM-GKY [Pradhan Mantri Garib Kalyan Yojana]’.

As a part of the PMGKY scheme, the government has decided to transfer ₹500 per month for three months to the poor and vulnerable sections of the society whose livelihood has been impacted due to the nationwide lockdown. Accounts that may have become dysfunctional due to non-operation in the account for the last two years have also been made functional.

“Please ensure that beneficiaries do not face any difficulty on this ground and are able to withdraw the money transferred to them by the government without any problems or requirement of additional documentation,” the communication said.

“Branch officials and business correspondents may be suitably instructed, along with necessary changes in the system (if required) for adherence to these guidelines,” it added.

The Finance Ministry had also requested the Home Ministry for adequate security personnel at bank branches and with the business correspondents to maintain law and order, and social distancing, in view of the higher customer footfall expected for cash withdrawals after the transfers are made. The Home Ministry, in turn, has requested the State chief secretaries to take all necessary measures to ensure smooth disbursal of funds to the beneficiaries of the PM GKY.

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Printable version | Jul 11, 2020 6:33:27 AM | https://www.thehindu.com/business/centre-tweaks-rules-to-make-inactive-accounts-functional/article31259624.ece

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