The Reserve Bank of India (RBI) has notified the Know Your Customer (KYC) (2nd Amendment) Directions, 2025, bringing in key changes to strengthen transparency, inclusivity, and compliance under its 2016 Master Directions on KYC. The amendments come into force with immediate effect.
The revised norms mandate that Persons with Disabilities (PwDs) be explicitly included under the definition of “disadvantaged” individuals. Banks and financial institutions cannot reject applications for onboarding or KYC updation without due consideration, and officers must record the reasons for any rejection.
Further, the amendment expands the scope of customer due diligence to cover occasional transactions of Rs 50,000 and above, whether conducted singly, in a series of connected transactions, or through international money transfers.
On the technology front, the RBI has permitted the use of Aadhaar Face Authentication as part of the authentication process. Importantly, liveness checks during digital KYC must not exclude persons with special needs.
Additionally, the Appendix of the Master Directions has been updated to incorporate earlier circular references, strengthening regulatory alignment.
