What changed
Previously, ADs and FFMCs had to obtain a conduct certificate from local police for all agents/franchisees. Now, for incorporated entities, they can accept certified copies of the Memorandum and Articles of Association and Certificate of Incorporation instead. The rest of the due diligence requirements remain unchanged.
What it means for you
This reduces a significant operational bottleneck for banks and FFMCs when onboarding corporate franchisees, as police certificates were often delayed or hard to get. It streamlines KYC without compromising on verification, since corporate documents are already registered with authorities. Banks should update their internal checklists and the RMC-F form for corporate franchisees accordingly.
What you must do
- Update your due diligence checklist for corporate franchisees to accept certified MoA, AoA, and Incorporation Certificate in lieu of police conduct certificate.
- Modify Item No. 6 of Form RMC-F in Annex-IV for corporate franchisees as per the circular.
- Communicate this change to all relevant branches and franchisee onboarding teams.
- Ensure all other provisions of paragraph (C) 4 of Annex-I remain strictly followed.
Who it affects
AD Category-I banks, AD Category-II banks, Full-Fledged Money Changers (FFMCs), Corporate franchisees of money changers
Does this circular apply to individual franchisees as well?
No, the relaxation is only for agents/franchisees that are incorporated entities. Individual franchisees still need to provide a conduct certificate from local police authorities.
What documents are now acceptable for corporate franchisee due diligence?
Certified copies of the Memorandum and Articles of Association and the Certificate of Incorporation are now acceptable in place of the police conduct certificate.
Do we need to update any forms because of this change?
Yes, Item No. 6 of Form RMC-F in Annex-IV of the earlier circular should be suitably modified for corporate franchisees.