Banks to Mention ‘Name of Purchaser’ on Face of DD/ BC/ PO w.e.f. 15 Sept. 2018: RBI

Banks to Mention ‘Name of Purchaser’ on Face of DD/ BC/ PO w.e.f. 15 Sept. 2018: RBI

RBI has notified that all Banks/ Branches are required to mention the name of respective ‘Purchaser’ on the face of Demand Drafts (DD), Banker’s Cheque (BC), Pay Order (PO), etc., w.e.f. 15 Sept. 2018, to avoid possible misuse of such instruments for the purpose of money laundering.

So far the Banks were required to mention name of the Beneficiary only while issuing the DD, BC, PO, etc. However, a few banks/ branches were voluntarily mentioning name of the purchaser as well.

Incorporation of Name of the Purchaser on the Face of the Demand Draft: RBI Notification dt. 12 July, 2018

To,

The Chairperson/ CEOs of all Scheduled Commercial Banks including Regional Rural Banks/Urban Co-operative Banks/ State Co-operative Banks/ District Central Co-operative Banks/ Local Area Banks/ Small Finance Banks/ Payment Banks

In order to address the concerns arising out of the anonymity provided by payments through demand drafts and its possible misuse for money laundering, it has been decided that the name of the purchaser be incorporated on the face of the demand draft, pay order, banker’s cheques, etc., by the issuing bank. These instructions shall take effect for such instruments issued on or after September 15, 2018.

Accordingly, Section 66 of the Master Direction on KYC dated February 25, 2016, as amended on April 20, 2018, has been amended and following paragraph has been added:

Further, the name of the purchaser shall be incorporated on the face of the demand draft, pay order, banker’s cheques, etc., by the issuing bank. These instructions shall take effect for such instruments issued on or after September 15, 2018.

2. You are advised to ensure compliance with the above.

One Response

  1. RM

Leave a Reply