Question

Which of the following is the purpose of introducing 'Know Your Customer' norms by the banks?

• A. To bring more and more people under the banking net
• B. Identifying people who do not pay income tax
• C. To ensure that the money deposited in banks has come from genuine sources
• D. To ensure whether the money deposited in the bank is of an Indian or a foreign national

Answer 1

Answer: (C)

To ensure that the money deposited in banks has come from genuine sources

KYC stands for Know Your Customer. Purpose of introducing Know Your Customer is to ensure tat the money deposited in banks has come from genuine sources. It is introduced mainly to prevent malpractices.