RBI expanded KYC document options for FPIs banking with rural and urban co-operative banks, permitting overseas-certified copies.

Until now, when an FPI wanted to complete KYC with a co-operative bank, the bank was required to physically compare the copy of the documents with the original, in person.

That process has now been simplified. FPIs can instead submit an original certified copy of their KYC documents, without the bank needing to verify it against the physical original each time.

This might sound like a small tweak, but it actually brings FPIs on par with a facility that Non-Resident Indians and Persons of Indian Origin were already getting.

In other words, the RBI has simply extended an existing convenience to a wider set of foreign investors. The RBI has laid out a clear list of authorities.

This includes an authorised official at an overseas branch of a scheduled commercial bank registered in India, an overseas bank branch that has a tie up with an Indian bank, or alternatively, a notary public, court magistrate or judge based abroad.

FPIs also have the option of getting their documents certified through the Indian Embassy or Consulate General in the country where they reside.

The RBI clarified that these changes have been made under the framework of the Prevention of Money Laundering Act, 2002, along with the Prevention of Money Laundering Maintenance of Records Rules, 2005.

The move is expected to cut down on paperwork delays for foreign investors and make onboarding with co-operative banks a smoother process going forward.

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