Non-compliance with KYC procedures alleged; SBI customers troubled

Malappuram: A few employees of Kottakkal Arya Vaidya Sala who have their salary accounts with the State Bank of India were confused and put in trouble by the bank on Saturday. They were shocked to see their accounts having been debited with huge amounts.

SBI officials clarified that 20 accounts were credited with negative balance, so as to freeze further transactions. The bank took the action as the said accounts were yet to comply with the Know-Your-Customer (KYC) requirements. "The idea was to freeze the accounts in order to avoid further transactions," he explained.

While money can be credited to the account, only the amount minus the 'negative credit' can be withdrawn.

Earlier, a hubbub was caused as some of them misunderstood the debit figure and spread rumour that their accounts were credited with huge deposits. The bank officials said that the customers failed to notice the 'minus' sign near the amount and that caused the confusion.

However, the customers alleged that the bank authorities failed to serve a clear explanation as to what had happened. Suresh, one of the customers, alleged that he had submitted all the necessary documents and the KYC process remained incomplete only due to laxity on the part of the SBI.

According to the Reserve Bank of India, failure to comply with KYC requirements, despite repeated reminders, may lead to freezing of such accounts. Once frozen, the accounts can be reactivated only after furnishing the KYC compliance procedures.