Current · Source: Reserve Bank of India · RBI/2013-14/524 · issued 19 Mar 2014 · ~1 min read
Quick answerRBI directs NBFCs to consider FATF's updated February 2014 statement on jurisdictions with AML/CFT deficiencies. This does not ban legitimate trade with those countries but requires enhanced vigilance.
The rule, in the simplest words
NBFCs must consider FATF's updated list of jurisdictions with weak AML/CFT regimes when assessing customer risk and transaction monitoring.
Legitimate business with these jurisdictions is not prohibited, but lenders need to apply enhanced due diligence to avoid regulatory penalties.
NBFCs must review and update their AML/CFT risk assessment frameworks according to the latest FATF list.
Enhanced monitoring is required for customers linked to high-risk jurisdictions.
How it plays out — a real example
A KYC & compliance officer in Indore, Mr. Kumar, reviews the FATF list and updates the risk assessment framework for his NBFC. He ensures that his compliance team is aware of the jurisdictions flagged in the February 2014 FATF update and applies enhanced due diligence to customers with cross-border transactions, while continuing to allow legitimate trade transactions.
What changed
FATF updated its public statement on February 14, 2014, regarding jurisdictions with weak AML/CFT regimes. RBI has forwarded this update to all NBFCs (excluding residuary non-banking companies) for their reference and action.
What it means for you
NBFCs must factor in the latest FATF list when assessing customer risk and transaction monitoring. While legitimate business with these jurisdictions is not prohibited, lenders need to apply enhanced due diligence to avoid regulatory penalties.
What you must do
Review the enclosed FATF statement and update your AML/CFT risk assessment frameworks accordingly.
Ensure your compliance team is aware of the jurisdictions flagged in the February 2014 FATF update.
Continue to allow legitimate trade transactions but apply enhanced monitoring for customers linked to these jurisdictions.
Document your due diligence measures for any exposure to high-risk jurisdictions.
Who it affects
All Non-Banking Financial Companies (NBFCs) excluding Residuary Non-Banking Companies, Compliance and risk management teams of NBFCs, NBFC customers with cross-border transactions
❓ Common questions
Does this circular ban business with the listed jurisdictions?
No. The circular explicitly states that it does not preclude NBFCs from legitimate trade and business transactions with these countries and jurisdictions.
What should NBFCs do with the FATF statement?
NBFCs are advised to consider the information in the statement for their AML/CFT compliance, meaning they should update their risk assessments and monitoring procedures accordingly.
📜 Read the original circular — full text as issued by RBI
RBI/2013-14/524
DNBS(PD).CC.No 370/03.10.42/2013-14
March 19, 2014
All Non Banking Financial Companies excluding
Residuary Non Banking Companies
Dear Sirs,
Anti-Money Laundering (AML)/Combating of Financing of Terrorism (CFT) - Standards
Please refer to DNBS (PD).CC.No.364/03.10.42/2013-14 dated January 1, 2014 on risks arising from the deficiencies in AML/CFT regime of certain jurisdictions.
2. Financial Action Task Force (FATF) has updated its statement on February 14, 2014 on the captioned subject and document ‘Improving Global AML/CFT Compliance: On-Going Process’ ( copy enclosed ). The statement /document can be accessed from the following URL also:
http://www.fatf-gafi.org/media/fatf/documents/statements/Public-Statement-14-February-2014.pdf and
http://www.fatf-gafi.org/topics/high-riskandnon-cooperativejurisdictions/documents/fatf-compliance-feb-2014.html
3. All NBFCs are accordingly advised to consider the information contained in the enclosed statement.This, however, does not preclude NBFCs from legitimate trade and business transactions with these countries and jurisdictions.
Yours faithfully,
(Sindhu Pancholy)
Deputy General Manager
Encl: as above
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2013-14/524 · issued 19 Mar 2014. The plain-English explanation above is BankPulse’s own independent summary.
Example: if you are a Compliance officer at a bank this circular applies to (All Non-Banking Financial Companies (NBFCs) excluding Residuary Non-Banking Companies, Compliance and risk management teams of NBFCs, NBFC customers with cross-border transactions), your first concrete step on “RBI Updates NBFCs on FATF AML/CFT Compliance List” is: “Review the enclosed FATF statement and update your AML/CFT risk assessment frameworks accordingly.” (RBI issued this 19 Mar 2014).
Circular: RBI/2013-14/524 -- RBI Updates NBFCs on FATF AML/CFT Compliance List
Issued: 19 Mar 2014
Action required: Review the enclosed FATF statement and update your AML/CFT risk assessment frameworks accordingly.
Action required: Ensure your compliance team is aware of the jurisdictions flagged in the February 2014 FATF update.
Action required: Continue to allow legitimate trade transactions but apply enhanced monitoring for customers linked to these jurisdictions.
Action required: Document your due diligence measures for any exposure to high-risk jurisdictions.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
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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BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=8777&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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