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SBP revises digital customer onboarding framework

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KARACHI: The State Bank of Pakistan (SBP) has revised the Customer Digital Onboarding Framework to clarify regulatory expectations for digital onboarding.

The framework mainly covered the opening of digital accounts by banks/MFBs as well as the introduction of three types of Asaan digital accounts which allow for limited transactional activity and can be opened with simplified know-your-customer (KYC) requirements and Customer Due Diligence (CDD). This includes Asaan Digital Account (ADA), Asaan Digital Remittance Account (ADRA), and Independent Digital Account (FDA).

However, during our continued engagement with the banking industry, SBP has observed with grave concern that many banks/MFBs are collecting unnecessary information and documentation from customers, particularly for opening ADA, ADRA or FDA, which not only causes delays in the account opening process, but also hinders the customer’s seamless digital onboarding experience. Additionally, the user experience through the account opening process of most banks/MFBS needs to be significantly improved.

Therefore, to clarify regulatory expectations for digital integration, particularly for the ADA, ADRA, and FDA, the topic framework has been revised and is attached hereto. Banks/MFBs have been asked to ensure compliance with the new instructions and failure to comply may result in necessary enforcement action under the relevant provisions of the law.

SBP designs the “Digital Customer Onboarding Framework”

In line with the revised framework, banks/MFBs will ensure compliance with CDD requirements and perform full Know Your Customer (KYC), Customer Due Diligence (CDD), Enhanced Customer Due Diligence (EDD for opening of ADA, ADRA and FDA). part of CDD, can perform client KYC via registered video call facility based on its internal risk assessment and compliance framework For high-risk clients requiring Enhanced Due Diligence (EDD) in accordance with AML regulations /CFT/CPF, video/interview is mandatory.

In accordance with the amended framework, banks/MFBs will put in place the necessary technological infrastructure and operational controls to ensure the data integrity, confidentiality, security and confidentiality of customer details/documents, collected and transmitted through their applications. /mobile websites and other digital channels. banks/MFBs, in this respect, will ensure that they adopt the minimum controls and procedures mentioned in Annex – D of this framework.

The State Bank has developed a “Digital Customer Onboarding Framework” for banks/MFB which, among other things, elaborates the basic parameters for opening bank accounts for Pakistani residents through digital channels. The Digital Customer Onboarding Framework consistently requires all banks and Microfinance Banks (MFBs) to implement it by December 31, 2021.

Copyright Business Recorder, 2022