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RBI Updates AML/CFT Guidance for MTSS Agents

Current · Source: Reserve Bank of India · RBI/2010-11/471 · issued 06 Apr 2011 · ~1 min read
Quick answerRBI directs all Indian Agents under MTSS to consider FATF's October 2010 statement on AML/CFT. Agents must update compliance procedures for cross-border inward remittances and ensure their constituents are informed.
The rule, in the simplest words
How it plays out — a real example

After reviewing FATF's statement, Rohan, a KYC & compliance officer in Indore, updates the bank's AML/CFT policies to ensure robust due diligence on cross-border inward remittances. He communicates the updated guidelines to all relevant constituents, including the bank's customers, and verifies that the cross-border inward remittance processes comply with PMLA and FEMA provisions.

What changed

RBI issued a circular on April 6, 2011, referencing FATF's October 22, 2010 statement. It advises all Authorised Persons (Indian Agents) under MTSS to consider the information in that statement. This builds on earlier guidance from November 2009.

What it means for you

Indian banks acting as MTSS agents must align their AML/CFT checks with FATF's latest expectations. Non-compliance could attract penalties under FEMA and PMLA. This reinforces the need for robust due diligence on cross-border inward remittances.

What you must do

Who it affects

All Authorised Persons (Indian Agents) under Money Transfer Service Scheme, Banks handling cross-border inward remittances, Compliance and AML/CFT teams in banks

❓ Common questions

What is the key action required from MTSS agents?

Agents must consider the information in FATF's October 2010 statement and ensure their AML/CFT procedures are updated. They also need to inform their constituents and have their Principal Officer acknowledge receipt of the circular.

What are the legal bases for this circular?

The circular is issued under Section 10(4) and Section 11(1) of FEMA, 1999, and under PMLA, 2002, as amended. Non-compliance can attract penalties under these acts.

📜 Read the original circular — full text as issued by RBI
RBI/2010-11/471 A.P. (DIR Series) Circular No. 52 A.P. (FL Series) Circular No. 14 April 06, 2011 To, All Authorised Persons, who are Indian Agents under Money Transfer Service Scheme. Madam/ Dear Sir, Anti-Money Laundering (AML) standards/Combating the Financing of Terrorism (CFT) Standards - Cross Border Inward Remittance under Money Transfer Service Scheme Attention of all Authorised Persons, who are Indian Agents under Money Transfer Service Scheme (MTSS) is invited to Paragraph 5.10 (b) of Annex-I, Annex to A.P. (DIR Series) Circular No.18 {A.P. (FL Series) Circular No.5} dated November 27, 2009 on the captioned subject. 2.Financial Action Task Force (FATF) has issued a further Statement on October 22, 2010 on the subject ( copy enclosed ) calling upon jurisdictions listed in the Statement to complete the implementation of their action plan within the timeframe. The FATF, in the Statement has called upon its members to consider the information given in the Statement.  3.All Authorised Persons (Indian Agents) are accordingly advised to consider the information contained in the enclosed Statement. 4.Authorised Persons (Indian Agents) may bring the contents of this circular to the notice of their constituents concerned. 5.Please advise your Principal Officer to acknowledge receipt of this circular letter. 6.The directions contained in this Circular have been issued under Section 10(4) and Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and also under the Prevention of Money Laundering Act, (PMLA), 2002, as amended by Prevention of Money Laundering (Amendment) Act, 2009 and Prevention of Money-Laundering (Maintenance of Records of the Nature and Value of Transactions, the Procedure and Manner of Maintaining and Time for Furnishing Information and Verification and Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial Institutions and Intermediaries) Rules, 2005 as amended from time to time. Non-compliance with the guidelines would attract penal provisions of the Acts concerned or Rules made there under. Yours faithfully, (Smt. Sujatha Elizabeth Prasad) Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2010-11/471 · issued 06 Apr 2011. The plain-English explanation above is BankPulse’s own independent summary.
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Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (All Authorised Persons (Indian Agents) under Money Transfer Service Scheme, Banks handling cross-border inward remittances, Compliance and AML/CFT teams in banks), your first concrete step on “RBI Updates AML/CFT Guidance for MTSS Agents” is: “Review FATF's October 2010 statement and update your AML/CFT policies accordingly.” (RBI issued this 06 Apr 2011).

  1. Circular: RBI/2010-11/471 -- RBI Updates AML/CFT Guidance for MTSS Agents
  2. Issued: 06 Apr 2011
  3. Action required: Review FATF's October 2010 statement and update your AML/CFT policies accordingly.
  4. Action required: Ensure your Principal Officer acknowledges receipt of this circular.
  5. Action required: Communicate the updated guidelines to all relevant constituents.
  6. Action required: Verify that your cross-border inward remittance processes comply with PMLA and FEMA provisions.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

💬 Banker Discussion

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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6335&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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