Processing

Please Wait ...

We at Edelweiss Retail Finance Limited (“ERFL/Company”) are committed to serve to make our client’s experience a rewarding one at our Company. ERFL’s Grievance Redressal Mechanism articulates our objective to minimize instances that give rise to customer complaints and create a review mechanism to ensure consistently superior service behavior.

We ensure prompt redressal of all complaints and use it for effecting necessary changes to improve the services further. In case of any complaint/grievance, the borrowers / customers including the applicants with disability (ies) may contact through any of the following channels.

First Level: The customer can directly approach the Branch Manager and enter his/her complaint/grievance in the compliant register maintained at the branch. On registering the complaint, the customer should obtain complaint number and date for future reference.

Second Level: If the complaint is unresolved at branch level, the customer may approach the Corporate Office through:
  • Email : kindly mail us at: homeservice@edelweissfin.com
  • You could also reach us at 022-42722272 to the attention of : Mr. Karthik Balasubramanian, Grievance Redressal Officer/ Nodal Officer
  • You can write to us at: Edelweiss Retail Finance Ltd, Edelweiss House, Off. C.S.T Road, Kalina, Mumbai - 400098.
After examining the matter, it would be our endeavour to provide the borrower / applicant with our final or other response, within a period of one month, from receipt of such complaint/grievance.

Third Level: In case the borrower/customer do not receive any communication from the Grievance Redressal Officer or the borrower/customer is not satisfied with the resolution or the complaint remain unresolved by the Grievance Redressal Officer within a period of one month, the borrowers / customers may appeal to:-


The Officer-in-Charge,
Reserve Bank of India, 3rd Floor,
Near Maratha Mandir, Byculla,
Mumbai Central, Mumbai - 400008;
Tel: +91 22-23084121/23028436;
Fax: +91 22-23022011; email id- dnbsmro@rbi.org.in

GRIEVANCES REDRESSAL MECHANISMS

Internal Procedures

(a) The Company shall have the system and procedures for receiving, registering and disposing of complaints and grievances in each of its offices.
(b) The Board of Directors of the Company has laid down the appropriate grievance Redressal mechanism within the organization to resolve complaints and grievances. Such mechanism shall ensure that all disputes arising out of the decisions of lending institutions' functionaries are heard and disposed of at least at the next higher level.
(c) Customer shall be told where to find details of the Company’s procedure for handling the complaints, fairly and quickly.
(d) If the customer wants to make a complaint, then the customers should be informed on the following:
I. How to do this
II. Where a complaint can be made
III. How a complaint should be made
IV. When to expect a reply
V. Whom to approach for redressal
VI. What to do if the customer is not happy about the outcome.
VII. Our staff shall help the customer with any queries the customer has.
(e) If a complaint has been received in writing from a customer, we shall endeavour to send him/her an acknowledgement / response within a week. The acknowledgement will contain the name & designation of the official who will deal with the grievance. If the complaint is relayed over phone at our designated telephone helpdesk or customer service number, the customer shall be provided with a complaint reference number and be kept informed of the progress within a reasonable period of time.
(f) After examining the matter, we shall send the customer its final response or explain why it needs more time to respond and shall endeavour to do so within six weeks of receipt of a complaint and he/she should be informed how to take his/her complaint further if he/she is still not satisfied.
Grievance Redressal Procedure
In case of any complaint/grievance, the customer may contact our Corporate Office through any of the following channels:
Telephone: 022-42722272
Email/letter to the attention of:
Mr. Nileshkumar Jain (Grievance Redressal Officer)
Email: homeservice@edelweissfin.com
Mail: Edelweiss Housing Finance Ltd, Edelweiss House, Off. C.S.T. Road, Kalina, Mumbai-400098

After examining the matter, it would be our endeavor to provide the customer with our response, within a period of six (6) weeks from receipt of such complaint/grievance.
If the customer does not receive response from the Company or is dissatisfied with the response received, the complainant may approach the Complaint Redressal Cell of National Housing Bank by lodging his complaint in Online mode at the link http://grids.nhbonline.org.in or in Offline mode by post in prescribed format
available at link http://www.nhb.org.in/Grievance-Redressal-System/Lodging-Complaint-Against-HFCs-NHB%E2%80%93Physical-Mode.pdf the following address: National Housing Bank, Department of Regulation and Supervision (Complaint Redressal Cell), 4th Floor, Core-5A, India Habitat Centre, Lodhi Road, New Delhi – 110 003.
The Complaint can also be e-mailed at crcell@nhb.org.in
The above mentioned Grievance Redressal Procedure is also available at Company’s website at www.edelweisshousingfin.com
Edelweiss Retail Finance Limited (the Company/ ERFL), in pursuance of the Directions issued by Reserve Bank of India for Non-Banking Financial Companies (NBFCs), has adopted the following Code for fair practices while dealing with customers. The Fair Practice Code (FPC) is intended to cover the following areas:
  • Applications for loans and their processing
  • Loan appraisal and terms/conditions
  • Disbursement of loans, including changes in terms and conditions
  • General provisions and
  • Grievance redressal mechanism

1. Applications for loans and their processing

  • All relevant information pertaining to the loan/loan facility will be made available in the relevant loan application form(s) or through other modes (term sheet, teasers, etc.). The loan application form will also indicate the documents required to be submitted together with the duly completed application form.
  • The client will have the option to receive all the correspondences, loan documents, recall notices etc relating to loan in vernacular language or a language understood by the Client. For this purpose the Client need to indicate his/her/its preference in the loan application form by selecting the appropriate option.
  • Receipt of completed applications forms will be duly acknowledged within appropriate timeframe.
  • 2. Loan appraisal and terms/conditions

  • Loan applications shall be assessed in accordance with the Company’s credit appraisal process and policies. The client shall be advised in the language selected by him/her/it in the loan application of the outcome of the credit appraisal (approval/rejection) within the period for appraising the loan application indicated in the acknowledgment to loan application.
  • Upon approval of the loan, the Company shall convey the amount of loan sanctioned, annualized interest rate, default interest rate and other important terms and conditions to the Client by way of sanction letter or otherwise in the language selected by the Client in the application form for correspondence, etc. The penal interest, if any, to be charged by the Company for late repayment, etc shall be mentioned in bold in the loan agreement, sanction letter, etc. A acceptance of such terms and conditions shall be retained by the Company.
  • The Company shall enter into an agreement indicating the amount of loan sanctioned, annualised rate of interest applicable, including method of application thereof, along with the terms and conditions with the client. A copy of the said agreement along with schedule(s) and annexure(s) to the agreement will be provided to the client in the language opted by the client.
  • 3. Disbursement of loans including changes in terms and conditions

  • Any changes to the terms and conditions, including disbursement schedule, interest rates, service charges, prepayment charges, etc, shall be informed individually to the borrowers in case of account specific changes, and in case of others, the same shall be available at the registered office / corporate office of the Company or on website or be disseminated through print media if the Company so decide.
  • Changes in the interest rates and charges shall be effected prospectively. A suitable condition to this effect will be inserted in the loan agreement.
  • Decision to recall / accelerate payment or performance under the agreement shall be in accordance with the terms and conditions of the loan documents executed by the borrower with the Company.
  • All securities pertaining to the loan would be released on receipt of full and final payment of the loans, subject to any legitimate or contractual right or lien or right to set-off which the Company or any other person may have under the loan documents against the borrowers. If such right of set-off is to be exercised, the borrower shall be given notice about the same, with full particulars about the remaining claims and the conditions under which the right to retain or setoff the securities/sale proceeds from the securities or right to transfer the securities or sale proceeds is exercised by the Company . In the event of full and final payment of the loans along with other dues, if any, “No outstanding dues” certificate shall be issued by the Company within 1 month from the date of receipt of request from the borrower / customer.
  • All notices, correspondence in respect of the loan will be made in the language opted by the Client in the loan application form.
  • 4. Applicant with Disability (ies)

    The Company shall not discriminate in extending products and facilities including loan facilities to the physically / visually challenged applicants on the grounds of disability. They shall be treated at par with the other applicants and their application shall be dealt on merit as per the credit process and policy of the Company. All possible assistance will be provided to the applicants with the disability (ies) to enable them to understand, select and avail appropriate product or loan facility.

    5. General provisions

  • The Company shall refrain from interference in the affairs of the borrower, except for the purposes and as provided in the terms and conditions of the loan documents or unless new information, not earlier disclosed by the borrower, has come to the notice of the Company.
  • In case of receipt of request from the borrower for transfer of borrowal account, the consent or otherwise, i.e. objection of the Company, if any, shall be conveyed within 21 days from the date of receipt of request.
  • In the matter of recovery of loans, the Company shall not resort to undue harassment viz persistently bothering the borrower at odd hours, use of muscle power for recovery of loans and would operate within the legal framework. The Company will ensure that all its employees are adequately trained to deal with the borrowers in an appropriate manner.
  • The Company shall not charge foreclosure charges/ pre-payment penalties on all floating rate term loans sanctioned to individual borrowers.
  • 6. Grievance Redressal

    The implementation of the Fair Practice Code shall be the responsibility of the Company. The Company shall make every effort to ensure that its dealing with borrowers / customers is smooth and hassle free. Any complaint brought to the notice of the Company by a borrower / customer will be handled expeditiously.

    The Board of Directors of the Company has laid down the appropriate grievance redressal mechanism within the organization to resolve complaints and grievances. All disputes / complaints arising out of the decisions of the Company’s functionaries would be heard and disposed of at least at the next higher level after it is brought to their notice.

    A consolidated report of periodical review with compliance with the Fair Practices Code and functioning of the grievances redressal mechanism at various levels of management would be submitted to the Board of Directors (or a committee thereof) at regular intervals.

    The contact details of the Grievance Redressal Officer (“GRO”) and the local office of RBI (which can be approached, if the complaint / dispute is not resolved within a period of one month) will be displayed at all the branches / places where the Company conducts its business.

    In case of any complaint/grievance, the borrowers / customers including the applicants with disability (ies) may contact through any of the following channels:

    At level 1: The customer can directly approach the Branch Manager and enter his/her complaint/grievance in the compliant register maintained at the branch.

    Second Level: If the complaint is unresolved at branch level, the customer may approach the Corporate Office through:
  • Email : kindly mail us at: homeservice@edelweissfin.com
  • You could also reach us at 022 –42722272 to the attention of: Mr. Karthik Balasubramanian, Grievance Redressal Officer/ Nodal Officer
  • You can write to us at: Edelweiss Retail Finance Ltd, Edelweiss House, Off. C.S.T Road, Kalina, Mumbai - 400098.
  • After examining the matter, it would be our endeavour to provide the borrower / applicant with our final or other response, within a period of one month, from receipt of such complaint/grievance.

    Third Level: In case the borrower/customer do not receive any communication from the Grievance Redressal Officer or the borrower/customer is not satisfied with the resolution or the complaint remain unresolved by the Grievance Redressal Officer within a period of one month, the borrowers / customers may appeal to:-
    The Officer-in-charge, Department of Non-Banking Supervision
    Reserve Bank of India, 3rd Floor, Near Maratha Mandir, Byculla, Mumbai Central, Mumbai - 40008;
    Tel: +91 22-23084121/ 23028436; Fax: +91 22-23022011;
    email id- dnbsmro@rbi.org.in

    7. Interest Charges:

  • The Board of Directors has adopted an interest rate model for determining the rate of interest to be charged on loans and advances, processing and other charges taking into account relevant factors such as, cost of funds, margin and risk premium, etc. The rate of interest and the approach for gradations of risk and rationale for charging different rate of interest to different categories of borrowers shall be disclosed to the borrower or customer in the application form and agreed interest are shall be communicated explicitly in the sanction letter.
  • The rates of interest and the approach for gradation of risks shall also be made available on the web-site of the company. The information published in the website or otherwise published will be updated, whenever there is a change in the rates of interest.
  • The rate of interest would be annualized rates so that the borrower is aware of the exact rates that would be charged to the account.
  • 8. Review of Policy

  • The Code will be reviewed at yearly intervals or as and when felt necessary by the Board.
  • Edelweiss Housing Finance Limited (EHFL/Company) is a Housing Finance Company registered with National Housing Bank (NHB) and is engaged the business of providing Home Loans and other loans to its customers. Such credit facility is extended to different types of customers, which include Individuals, Partnership Firms, Companies and other Corporate/Legal Entities.
    The Company have framed and adopted a Fair Practices Code “Code” which sets the principles for fair practice standards when dealing with customers. The Code has been reviewed and revised based on the Master Circular on Fair Practices Code issued by National Housing Bank on July 1, 2016.

    1. OBJECTIVES OF THE CODE

    The Code has been developed to:
  • Promote good and fair practices by setting minimum standards in dealing with customers;
  • Increase transparency so that the customers can have a better understanding of what they can reasonably expect of the services;
  • Encourage market forces, through competition, to achieve higher operating standards;
  • Promote a fair and cordial relationship with customers;
  • Foster confidence in housing finance system.
  • 2. APPLICATION OF CODE

    All parts of this Code apply to all the products and services, whether they are provided by the Company or subsidiaries across the counter, over the phone, by post, through interactive electronic devices, on the internet or by any other method.

    3. TO ACT FAIRLY AND REASONABLY IN ALL DEALINGS WITH CUSTOMERS BY:

  • Meeting the commitments and standards in this Code, for the products and services we offer, and in the procedures and practices our staff follows;
  • Making sure that our products and services meet relevant laws and regulations in letter and spirit;
  • Ensuring that our dealings with customers rest on ethical principles of integrity and transparency;
  • 4. ADVERTISING, MARKETING AND SALES

  • We shall ensure that all advertising and promotional material is clear, and not misleading.
  • In any advertising in any media and promotional literature that draws attention to a service or product and includes a reference to an interest rate, we shall also indicate whether other fees and charges, if any, will apply and that full details of the relevant terms and conditions are available on request.
  • We will provide information on interest rates, common fees and charges through putting up notices in our branches; through telephone or help-lines; on our website; through designated staff / help desk; or providing service guide / tariff schedule.
  • If we avail the services of third parties for providing support services, we will ensure that such third parties handle customer's personal information (if any available to such third parties) with the same degree of confidentiality and security as we would.
  • We will, from time to time, communicate to customers various features of our products availed by them. Information about our other products or promotional offers in respect of products / services, may be conveyed to customers only if he / she has given his / her consent to receive such information / service either by mail or by registering for the same on the website or on customer service number.
  • We will prescribe a code of conduct for our Direct Selling Agencies (DSAs) whose services are availed to market products / services which amongst other matters require them to identify themselves when they approach the customer for selling products personally or through phone.
  • In the event of receipt of any complaint from the customer that our representative / courier or DSA has engaged in any improper conduct or acted in violation of this Code, appropriate steps shall be initiated to investigate and to handle the complaint and to make good the loss, if any, to the customer.
  • 5. LOANS

  • Applications for loans & their processing
  • (a) At the time of sourcing a Loan Product, we will provide Information about the interest rates applicable, as also the fees/charges, if any, payable for processing, pre-payment options & charges, if any, & any other matter which affects the interest of the borrower, so that a meaningful comparison with those of other lenders can be made & informed decision can be taken by the borrower.
    (b) We shall transparently disclose to the borrower all information about fees / charges payable for processing the loan application, the amount of fees refundable if loan amount is not sanctioned / disbursed, pre-payment options and charges, if any, penalty for delayed repayment if any, conversion charges for switching loan from fixed to floating rates or vice versa, existence of any interest re-set clause and any other matter which affects the interest of the borrower. We would also ensure that such charges/ fees are non-discriminatory.
    (c) We shall issue an acknowledgement receipt for all loan applications. Loan applications shall be disposed of within such time as may be mutually agreed between the borrower and the Company from the date of receipt of the application form complete in all respects.
  • Loan appraisal and terms/conditions
  • (a) Normally all particulars required for processing the Loan Application shall be collected by us at the time of Application. In case we need any additional information, the Customer would be told that he would be contacted immediately again.
    (b) The customer would be informed by means of written or electronic mode of the amount of loan sanctioned or otherwise, the amount of loan sanctioned along with all terms and conditions including annualized rate of interest, method of application, EMI structure, prepayment charges etc. and customers’ acceptance of such terms and conditions will be obtained.
    (c) We shall provide the Copies of all the Loan Documents executed by the Customer along with a copy each of all enclosures quoted in the Loan Document on request.
  • Communication of rejection of Loan Application
  • If the Company is not in position to provide the loan to the customer, the Company shall communicate the reason (s) in writing through letter or through electronic mode for rejection.
  • Disbursement of loans including changes in terms and conditions
  • a) We shall disburse the loans in accordance with the disbursement request made by the customer or the disbursement schedule given in the Loan Agreement/ Sanction Letter;
    b) We shall give notice to the Customer of any change in the terms and conditions including disbursement schedule, interest rates, service charges, prepayment charges, other applicable fee/charges etc. We shall also ensure that changes in interest rates and charges are effected only prospectively. A suitable condition in this regard shall be incorporated in the loan agreement.
    c) If such change is to the disadvantage of the customer, then the customer may within 60 days of such change and without notice close their account or switch it without having to pay any extra charges or interest.
    d) Before taking a decision to recall / accelerate payment or performance under the Agreement or seeking additional securities, we shall give notice to borrowers in consonance with the Loan Agreement.
    e) We shall release all Securities within 30 days of repayment of all dues or on realization of the outstanding amount of loan subject to any legitimate right or lien for any other claim that we may have against the borrower. If such right of set off is to be exercised, the borrower shall be given a prior notice about the same with full particulars about the remaining claims & the conditions under which we are entitled to retain the securities till the relevant claim is settled / paid.

    6. GUARANTORS

    When a person intends to be Guarantor for a loan, he / she will be informed about:
  • his/her Liability as Guarantor;
  • the amount of Liability he/she will be committing himself / herself to the Company;
  • circumstances in which we will call on him / her to pay up his / her Liability;
  • whether we have recourse to his/her other monies/securities in the Company if he/she fails to pay up as a Guarantor;
  • whether his/her liabilities as a Guarantor are limited to a specific quantum or are they unlimited;
  • time and circumstances in which his/her liabilities as a Guarantor will be discharged as also the manner in which we will notify him her about this; and
  • In case the guarantor refuses to comply with the demand made by the creditor /lender, despite having sufficient means to make payment of the dues, such guarantor would also be treated as a wilful defaulter.
  • We shall keep him / her informed of any material adverse change/s in the financial position of the borrower for whom he / she stands as a Guarantor.

    7. PRIVACY AND CONFIDENTIALITY

    All personal information of customers shall be treated as private and confidential [even when the customers are no longer customers], and shall be guided by the following principles and policies. We shall not reveal information or data relating to customer accounts, whether provided by the customers or otherwise, to anyone, including other companies / entities in our group, other than in the following exceptional cases:
  • If the information is to be given by law;
  • If there is a duty towards the public to reveal the information;
  • If our interests require them to give the information (for example, to prevent fraud) but the same will not be used as a reason for giving information about customer or customer accounts [including customer name and address] to anyone else, including other companies in the group, for marketing purposes;
  • If the customer asks us to reveal the information, or with the customer's permission;
  • If we were asked to give a reference about customers, we shall obtain his / her written permission before giving it;
  • The customer shall be informed the extent of his / her rights under the existing legal framework for accessing the personal records that we holds about him/her; and
  • We shall not use customer's personal information for marketing purposes by anyone including us unless the customer specifically authorizes us to do so.
  • 8. CREDIT REFERENCE AGENCIES

  • When a customer opens an account, we shall inform him / her when we may pass his / her account details to credit reference agencies and the checks we may make with them.
  • We may give information to credit reference agencies about the personal debts the customer owes them if:
  • the customer has fallen behind with his / her payments;
  • the amount owed is not in dispute; and
  • the customer has not made proposal following our formal demand for repayment of dues. We will intimate the customer in writing through letter or electronic mode, in such a case.
  • In abovementioned cases, we shall intimate the customer in writing through letter or electronic mode about our intention to give information about the debts of the customer to the credit reference agencies. At the same time, we shall explain to the customer the role of credit reference agencies and the effect of the information we provide can have on customers’ ability to get credit.
  • We may give credit reference agencies such other information about the customer's account, if the customer has given them his / her permission to do so.
  • A copy of the information given to the credit reference agencies shall be provided by us to a customer, if so demanded.
  • 9. COLLECTION OF DUES

  • Whenever loans are given, we shall explain to the customer the repayment process by way of amount, tenure and periodicity of repayment. However if the customer does not adhere to the repayment schedule, a defined process in accordance with the laws of the land shall be followed for recovery of dues. The process will involve reminding the customer by sending him / her notice or by making personal visits and / or repossession of security if any.
  • Our collection policy shall be built on courtesy, fair treatment and persuasion. We believe in fostering customer confidence and long-term relationship. Our staff or any person authorized to represent us in collection of dues or / and security repossession shall identify himself / herself and display the authority letter issued by us and upon request, display his / her identity card issued by us or under the authority of the Company. We will provide customers with all the information regarding dues and shall endeavor to give sufficient notice for payment of dues.
  • All the members of the staff or any person authorised to represent us in collection and/or security repossession should follow the guidelines set out below:
  • (a) Customer would be contacted ordinarily at the place of his / her choice and in the absence of any specified place at the place of his / her residence and if unavailable at his / her residence, at the place of business / occupation.
    (b) Identity and authority to represent us shall be made known to the customer at the first instance.
    (c) Customer's privacy would be respected.
    (d) Interaction with the customer shall be in a civil manner.
    (e) Our representatives shall contact the customers between 0700 hrs and 1900 hrs, unless the special circumstances of the customer's business or occupation require otherwise.
    (f) If Customer's request to avoid calls at a particular time or at a particular place shall be honored as far as possible.
    (g) Time and number of calls and contents of conversation would be documented.
    (h) All assistance shall be given to resolve disputes or differences regarding dues in a mutually acceptable and in an orderly manner.
    (i) During visits to customer's place for dues collection, decency and decorum shall be maintained.
    (j) Inappropriate occasions such as bereavement in the family or such other calamitous occasions shall be avoided for making calls/visits to collect dues.

    10. COMPLAINTS AND GRIEVANCES

    Internal Procedures
  • The Company shall have the system and procedures for receiving, registering and disposing of complaints and grievances in each of its offices.
  • The Board of Directors of the Company has laid down the appropriate grievance Redressal mechanism within the organization to resolve complaints and grievances. Such mechanism shall ensure that all disputes arising out of the decisions of lending institutions' functionaries are heard and disposed of at least at the next higher level.
  • Customer shall be told where to find details of the Company’s procedure for handling complaints, fairly and quickly.
  • If the customer wants to make a complaint, then the customers should be informed on the following:
  • I. How to do this
    II. Where a complaint can be made
    III. How a complaint should be made
    IV. When to expect a reply
    V. Whom to approach for redressal
    VI. What to do if the customer is not happy about the outcome.
    VII. Our staff shall help the customer with any queries the customer has.
  • If a complaint has been received in writing from a customer, we shall endeavour to send him/her an acknowledgement / response within a week. The acknowledgement will contain the name & designation of the official who will deal with the grievance. If the complaint is relayed over phone at our designated telephone helpdesk or customer service number, the customer shall be provided with a complaint reference number and be kept informed of the progress within a reasonable period of time.
  • After examining the matter, we shall send the customer its final response or explain why it needs more time to respond and shall endeavour to do so within six weeks of receipt of a complaint and he/she should be informed how to take his/her complaint further if he/she is still not satisfied.

  • Following is mentioned on our website:
    Grievance Redressal Procedure
    IIn case of any complaint/grievance, the customer may contact our Corporate Office through any of the following channels:
    Telephone:022 – 42722272
    Email/letter to the attention of:
    Mr. Nileshkumar Jain (Grievance Redressal Officer)
    Email: homeservice@edelweissfin.com
    Mail: Edelweiss Housing Finance Ltd, Edelweiss House, Off. C.S.T. Road, Kalina, Mumbai-400098.
    After examining the matter, it would be our endeavor to provide the customer with our response, within a period of six (6) weeks from receipt of such complaint/grievance.
    If the customer does not receive response from the Company or is dissatisfied with the response received, the complainant may approach the Complaint Redressal Cell of National Housing Bank by lodging his complaint in Online mode at the link http://grids.nhbonline.org.in or in Offline mode by post in prescribed format
    available at link http://www.nhb.org.in/Grievance-Redressal-System/Lodging-Complaint-Against-HFCs-NHB%E2%80%93Physical-Mode.pdf the following address: National Housing Bank, Department of Regulation and Supervision (Complaint Redressal Cell), 4th Floor, Core-5A, India Habitat Centre, Lodhi Road, New Delhi – 110 003.
    The Complaint can also be e-mailed at crcell@nhb.org.in
    The above mentioned Grievance Redressal Procedure is also available at Company’s website at https://www.edelweisshousingfin.com

    11. GENERAL

  • If we think necessary, we will verify the details mentioned by customer in the loan application by contacting him / her at his / her Residence & / or on business telephone numbers & / or physically visiting his / her residence & / or business addresses through staff or through Agencies appointed for this purpose, if deemed necessary by us.
  • We shall inform the customer to co-operate if we need to investigate a transaction on the Customer’s Account & with the Police / other investigative agencies, if we need to involve them.
  • We shall inform the Customer that if the Customer acts fraudulently, he / she will be responsible for all losses on his / her account & that if the Customer acts without reasonable care & this causes losses, the Customer may be held responsible for the same.
  • We shall display about our products and services in any one or more of the following languages: Hindi, English or the appropriate local language.
  • We shall not discriminate on grounds of sex, caste & religion in the matter of Lending. Further we shall also not discriminate visually impaired or physically challenged applicants on the ground of disability in extending products, services, facilities, etc. However, this does not preclude us from instituting or participating in Schemes framed for different Sections of the Society.
  • We shall process requests for transfer of a loan account, either from the borrower or from a bank / financial institution, in the normal course.
  • To publicize the Code we will:-
  • 1. Provide existing and new customers with a copy of the Code;
    2. Make this Code available on request either over the counter or by electronic communication or mail;
    3. Make available this Code at every branch; and on our website. It is available at https://www.edelweisshousingfin.com ; and
    4. Ensure that our staff is trained to provide relevant information about the Code and to put the Code into practice.
  • The Code will be reviewed at yearly intervals or as and when there is regulatory development or Board deems fit that there is necessity to review the Code.
  • The Code will be reviewed basis the recommendation of Compliance Department and other relevant stakeholders, if any, and will be final once approved by the Board.
  • Policy on Know Your Customer & Anti Money Laundering Measures


    1. SCOPE

    1.1 Applicability
    The Know Your Customer and Anti-Money Laundering (the Policy) applies to Edelweiss Retail Finance Limited (hereinafter referred to as ‘the Company’ or ‘ERFL’).
    This Policy requires the Company and each employee to:
  • Protect the Company from being used for money laundering or funding terrorist activities;
  • Conduct themselves in accordance with the highest ethical standards;
  • Comply with the letter and the spirit of applicable Anti-Money Laundering (AML) Laws, and the Company’s KYC and AML procedures;
  • Be alert to and escalate suspicious activity and not knowingly provide advice or other assistance to individuals who attempt to violate or avoid money-laundering laws, or this Policy; and
  • Co-operate with the regulatory authorities and the Financial Intelligence Unit as per the applicable laws.

  • 1.2 Effective Date
    This revised Policy shall be effective from November 2, 2017.

    1.3 Review of Policy
    The Policy shall be reviewed annually or as and when required by the applicable rules and regulations.

    1.4 Implementation & Monitoring of Policy
    The Risk Management Committee (RMC) shall supervise the implementation of the Policy.

    1.5 Policy Approval
    The Policy and any significant changes therein shall be approved by the Board of Directors or the Audit Committee of the Company.
    2. BACKGROUND
    Money laundering refers to concealing or disguising the origin and ownership of the proceeds from criminal activity, including drug trafficking, public corruption, terrorism, fraud, human trafficking, and organized crime activities. Terrorist financing is the use of legally or illegally obtained funds to facilitate terrorist activities. Money laundering and terrorist financing may involve a wide variety of financial products, services, and transactions including lending and investment products, and the financing of equipment and other property that could be used to facilitate terrorism and other criminal activity.

    Almost any crime with a profit motive can create proceeds that can be laundered. For example, fraud, theft, illegal drug sales, organized crime, bribery, corruption of government officials and human trafficking can create illegal funds that a criminal seeks to convert into legitimate property without raising suspicion. Tax evasion and violations of fiscal laws can also lead to money laundering.

    Generally, the money laundering process involves three stages: placement, layering and integration. As illegal funds move from the placement stage through the integration stage, they become increasingly harder to detect and trace back to the illegal source.
  • Placement is the point where illegal funds first enter the financial system. The deposit of illegal cash into an account or the purchase of money orders, cashier’s checks or other financial product is made. Non-bank financial institutions, such as currency exchanges, money remitters, casinos, and check-cashing services can also be used for placement.
  • Layering After illegal funds have entered the financial system, layers are created by closing and opening accounts, purchasing and selling various financial products, transferring funds among financial institutions and across national borders. The criminal’s goal is to create layers of transactions to make it difficult to trace the illegal origin of the funds.
  • Integration occurs when the criminal believes that there are sufficient number of layers hiding the origin of the illegal funds to safely invest the funds or apply them towards purchasing valuable property in the legitimate economy.

  • A financial institution or other business may be used at any point in the money laundering process. There are many schemes that can be utilized to launder money and no financial institution or business is immune from possible victimization.

    To address money laundering, the Government of India and other countries around the world have made money laundering a crime and prescribed regulatory requirements for compliance by the banks, financial companies/ institutions and other regulated/ reporting entities to prevent and detect money laundering. In India and in many other countries, it is a crime to engage in a transaction with knowledge that the funds involved in the transactions are from illegal activity. Knowledge includes the concept of ‘willful blindness’ (failure to make appropriate inquiries when faced with suspicion of wrongdoing) and ‘conscious avoidance of knowledge’.

    To prevent money-laundering in India and to provide for confiscation of property derived from, or involved in, money-laundering and related matters, the Parliament of India enacted the Prevention of Money Laundering Act, 2002 (PMLA), as amended from time to time. Further, necessary Notifications / Rules under the said Act have been published and amended by the Ministry of Finance, the Government of India.

    As per the Prevention of Money Laundering Act 2002, the offence of Money Laundering is defined as:
    “Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and projecting it as untainted property shall be guilty of offence of money-laundering. "Proceeds of crime" means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to scheduled offence or the value of any such property.”

    The PMLA and rules notified thereunder impose obligation on banking companies, financial institutions (which includes chit fund company, a co-operative bank, a non-banking financial company and a housing finance institution) and intermediaries which includes a stock-broker, sub-broker, share transfer agent, banker to an issue, trustee to a trust deed, registrar to an issue, merchant banker, underwriter, portfolio manager, investment adviser etc. to verify identity of clients, maintain records and furnish requisite information to Financial Intelligence Unit- India (FIU-IND). The PMLA defines money laundering offence and provides for the freezing, seizure and confiscation of the proceeds of crime.

    The Reserve Bank of India (RBI) vide Master Direction DBR.AML.BC.No.81/14.01.001/2015-16 dated February 25 2016 and subsequent modifications thereof, have prescribed guidelines “Anti Money Laundering” guidelines/ standards.

    The KYC and AML Policy has been prepared considering the following 5 key elements:

    a) To lay down the criteria for Customer Acceptance (CAP);
    b) Risk Management;
    c) To lay down criteria for Customer Identification Procedures (CIP);
    d) To establish procedures for monitoring of transactions as may be applicable;
    e) To develop measures for educating employees and customers in regard with KYC.
    3. DEFINITIONS
    For the purpose of KYC Norms, definition of various terms used is as under:
    3.1 Beneficial Owner (BO)
  • Where the customer is a company, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have a controlling ownership interest or who exercise control through other means. Explanation- For the purpose of this sub-clause-

  • i) “Controlling ownership interest” means ownership of/entitlement to more than 25 per cent of the shares or capital or profits of the company.
    ii) “Control” shall include the right to appoint majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements.
  • Where the customer is a partnership firm, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have ownership of/entitlement to more than 15 per cent of capital or profits of the partnership.
  • Where the customer is an unincorporated association or body of individuals, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have ownership of/entitlement to more than 15 per cent of the property or capital or profits of the unincorporated association or body of individuals.

    Explanation: Term ‘body of individuals’ includes societies. Where no natural person is identified under (a), (b) or (c) above, the beneficial owner is the relevant natural person who holds the position of senior managing official.
  • Where the customer is a trust, the identification of beneficial owner(s) shall include identification of the author of the trust, the trustee, the beneficiaries with 15% or more interest in the trust and any other natural person exercising ultimate effective control over the trust through a chain of control or ownership.

  • 3.2 Cash Transaction Report (CTR)-
    CTR should include the following:
  • all cash transactions of the value of more than Rs.10 lakh or its equivalent in foreign currency;
  • all series of cash transactions integrally connected to each other which have been individually valued below Rs.10 lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the monthly aggregate exceeds Rs.10 lakh or its equivalent in foreign currency


  • 3.3 Central KYC Records Registry (CKYCR)
    means an entity defined under Rule 2(1)(aa) of Prevention of Money-Laundering (Maintenance of Records) Rules, 2005, to receive, store, safeguard and retrieve the KYC records in digital form of a customer.

    3.4 Counterfeit Currency Transaction
    All cash transactions, where forged or counterfeit Indian currency notes have been used as genuine. These cash transactions should also include transactions where forgery of valuable security or documents has taken place.

    3.5 Customer
    For the purpose of KYC Norms, a ‘Customer’ is defined as a person who is engaged in a financial transaction or activity with a reporting entity and includes a person on whose behalf the person who is engaged in the transaction or activity, is acting.

    3.6 Customer Due Diligence (CDD)-
    Identifying and verifying the customer and the beneficial owner using ‘Officially Valid Documents’ as a ‘proof of identity’ and a ‘proof of address’.

    3.7 Designated Director
    Designated Director" means a person designated by the RE to ensure overall compliance with the obligations imposed under chapter IV of the PML Act and the Rules and shall include:-

    a. the Managing Director or a whole-time Director, duly authorized by the Board of Directors, if the RE is a company,
    b. the Managing Partner, if the RE is a partnership firm,
    c. the Proprietor, if the RE is a proprietorship concern
    d. the Managing Trustee, if the RE is a trust
    e. person or individual, as the case may be, who controls and manages the affairs of the RE, if the RE is an unincorporated association or a body of individuals, and
    f. a person who holds the position of senior management or equivalent designated as a 'Designated Director’ in respect of Cooperative Banks and Regional Rural Banks.

    Explanation. - For the purpose of this clause, the terms "Managing Director" and "Whole-time Director" shall have the meaning assigned to them in the Companies Act, 2013.

    3.8 KYC Templates
    means templates prepared to facilitate collating and reporting the KYC data to the CKYCR, for individuals and legal entities, as required by the relevant Rules.

    3.9 Non-face-to-face customers
    Customers who open accounts without visiting the branch/ offices of the Company or meeting its officials.

    3.10 Officially valid document (OVD)-
    Any document notified/ advised by the Central Government/ Reserve Bank of India as officially valid document for verifying identity and proof of address of customers.

    As on date, OVD means the passport, the Driving License, the Permanent Account Number (PAN) Card, the Voter's Identity Card issued by the Election Commission of India, Job Card issued by NREGA duly signed by an officer of the State Government, Letter issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number.

    Explanation: Customers, at their option, shall submit one of the six OVDs for proof of identity and proof of address.

    Further, information provided through prescribed e-KYC process will also be treated as an ‘Officially Valid Document’ and will be a valid process for KYC verification.

    If ‘simplified measures’ (only for customers who are rated as low risk by the Company and who do not possess any of the six officially valid documents) are applied for verifying the identity of the customers then the following documents are deemed to be OVD:


    i) Identity card with applicant’s photograph issued by Central/ State Government Departments, Statutory/ Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions;
    ii) Letter issued by a Gazetted officer, with a duly attested photograph of the person.

    For such ‘simplified measures’, the following additional documents are deemed to be OVDs for proof of address:
    i) Utility bill, which is not more than two months old, of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill);
    ii) Property or Municipal Tax receipt;
    iii) Bank account or Post Office savings bank account statement;
    iv) Pension or family Pension Payment Orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address;
    v) Letter of allotment of accommodation from employer issued by State or Central Government departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies. Similarly, leave and license agreements with such employers allotting official accommodation; and
    vi) Documents issued by Government departments of foreign jurisdictions or letter issued by Foreign Embassy or Mission in India.

    3.11 On-going Due Diligence
    Regular monitoring of transactions in accounts to ensure that they are consistent with the customers’ profile and source of funds.

    3.12 Periodic Updation
    means steps taken to ensure that documents, data or information collected under the CDD process is kept up-to-date and relevant by undertaking reviews of existing records at periodicity prescribed by the NHB, the PMLA and the Rules thereunder.

    3.13 Politically Exposed Persons
    Individuals who are or have been entrusted with prominent public functions, e.g., Heads of States/Governments, senior politicians, senior government/ judicial/military officers, senior executives of state-owned corporations, important political party officials etc. Broadly it can be categorized into:
    a. Foreign PEPs: Individuals who are or have been entrusted with prominent public functions by a foreign country, for example Heads of State or of government, senior politicians, senior government, judicial or military officials, senior executives of state owned corporations, important political party officials
    b. Domestic PEPs: Individuals who are or have been entrusted domestically with prominent public functions, for example Heads of State or of government, senior politicians, senior government, judicial or military officials, senior executives of state owned corporations, important political party officials
    c. International organization PEPs: persons who are or have been entrusted with a prominent function by an international organization, refers to members of senior management or individuals who have been entrusted with equivalent functions, i.e. directors, deputy directors and members of the board or equivalent functions
    d. Family members are individuals who are related to a PEP either directly or through marriage or similar forms of partnership.
    e. Close associates are individuals who are closely connected to a PEP, either socially or professionally.
    3.14 Principal Officer (PO)-
    An official designated by the Board of Directors of the Company for overseeing and managing the KYC & AML policies and processes. The PO will be responsible for ensuring compliance, monitoring transactions, and sharing and reporting information as required under the law/regulations.

    3.15 ‘Senior Management’
    for the purpose of KYC compliance shall include Designated Director, Head Credit & Risk, Business Head, Head of Compliance, Principal Officer (PO) and his supervisor.

    3.16 Simplified procedure
    means the procedure for undertaking customer due diligence in respect of customers, who are rated as low risk by the RE and who do not possess any of the six officially valid documents, with the alternate documents prescribed under the para 3.10 above.

    3.17 Suspicious transaction
    means a “transaction” as defined below, including an attempted transaction, whether or not made in cash, which, to a person acting in good faith:

    a) gives rise to a reasonable ground of suspicion that it may involve the proceeds of crime, regardless of the value involved; or
    b) appears to be made in circumstances of unusual or unjustified complexity; or
    c) appears to have no economic rationale or bona fide purpose; or
    d) gives rise to a reasonable ground of suspicion that it may involve financing of the activities relating to terrorism.

    Explanation: Transaction involving financing of the activities relating to terrorism includes transaction involving funds suspected to be linked or related to, or to be used for terrorism, terrorist acts or by a terrorist, terrorist organization or those who finance or are attempting to finance terrorism.
    3.18 Transaction
    means a purchase, sale, loan, pledge, gift, transfer, delivery or the arrangement thereof and includes:

    a) opening of an account;
    b) deposits, withdrawal, exchange or transfer of funds in whatever currency, whether in cash or by cheque, payment order or other instruments or by electronic or other non-physical means;
    c) the use of a safety deposit box or any other form of safe deposit;
    d) entering into any fiduciary relationship;
    e) any payment made or received in whole or in part of any contractual or other legal obligation;
    f) establishing or creating a legal person or legal arrangement.

    3.19 Walk-in Customer
    means a person who does not have an account based relationship with the Company, but undertakes transactions with the Company.

    3.20 Person
    Person” has the same meaning assigned in the Act and includes:
    a. an Individual
    b. A Hindu Undivided Family,
    c. A Company
    d. A Firm
    e. an association of persons or a body of individuals, whether incorporated or not,
    f. every artificial juridical person, not falling within any one of the above persons (a to e), and
    g. any agency, office or branch owned or controlled by any of the above persons (a to f).

    4. CUSTOMER ACCEPTANCE POLICY (CAP)
    In line with the various guidelines issued by NHB on “Know Your Customer Guidelines & Anti Money Laundering Standards” and provisions of the PMLA, the Company has formulated Customer Acceptance Policy (CAP) which lays down the broad criteria for acceptance of customers.

    The features of the CAP are detailed below:
    a) The Company shall not open any account(s) in anonymous, fictitious or 'benami' name(s).
    b) No account is opened where the Company is unable to apply appropriate CDD measures, either due to non-cooperation of the customer or non-reliability of the documents/ information furnished by the customer.
    c) No transaction or account based relationship will be undertaken without following the CDD procedure.
    d) The mandatory information to be sought for KYC purpose while opening an account and during the periodic updation will be specified
    e) ‘Optional’/additional information is obtained with the explicit consent of the customer after the account is opened.
    f) CDD Procedure will be followed for all the joint account holders, while opening a joint account.
    g) Circumstances in which, a customer is permitted to act on behalf of another person/entity, is clearly spelt out.
    h) The Company shall ensure that the identity of the customer does not match with any person with known criminal background or with banned entities such as individual terrorists or terrorist organizations, etc. For this purpose, the Company shall maintain lists of individuals or entities issued by RBI, United Nations Security Council, other regulatory & enforcement agencies, internal lists as the Company may decide from time to time. Full details of accounts/ customers bearing resemblance with any of the individuals/ entities in the list shall be treated as suspicious and reported.
    i) Adequate due diligence is a fundamental requirement for establishing the identity of the customer. Identity generally means a set of attributes which together uniquely identify a natural person or legal entity. In order to avoid fictitious and fraudulent applications of the customers, and to achieve a reasonable degree of satisfaction as to the identity of the customer, the Company shall conduct appropriate due diligence. The nature and extent of basic due diligence measures to be conducted at the time of establishment of account opening/relationship, would depend upon the risk category of the customers and involve collection and recording of information by using reliable independent documents, data or any other information. This may include identification and verification of the applicant and wherever relevant, ascertaining of occupational details, legal status, ownership and control structure and any additional information in line with the assessment of the risks posed by the applicant and the applicant’s expected use of the Company’s products and services from an AML perspective.
    j) The Company may rely on third party verification subject to the conditions prescribed by the RBI, the PMLA and the Rules thereunder in this regard.
    k) For non-face-to-face customers, appropriate due diligence measures (including certification requirements of documents, if any) will be devised for identification and verification of such customers.
    l) Relationship/opening of accounts shall be established and the beneficiary of the relationship/account shall also be identified.
    m) The information collected from the customer shall be kept confidential.
    n) Appropriate Enhanced Due Diligence (EDD) measures shall be adopted for high risk customers from AML perspective, especially those for whom the sources of funds are not clear, transactions carried through correspondent accounts and customers who are Politically Exposed Persons (PEPs) and their family members/close relatives.
    o) In respect of unusual or suspicious transactions/applications or when the customer moves from a low risk to a high-risk profile, appropriate EDD measures shall be adopted.
    p) Where the Company is unable to apply appropriate KYC measures due to non-furnishing of information and /or non-cooperation by the customer, the Company may consider closing the account or terminating the business relationship. However, the decision to close an existing account shall be taken at a reasonably senior level, after giving due notice to the customer explaining the reasons for such a decision.The aspects mentioned in the CAP would be reckoned while evolving the KYC/AML procedures for various customers/products. However, while developing the KYC/CDD procedures, the Company shall ensure that its procedures do not become too restrictive or pose significant difficulties in availing its services by deserving general public, especially the financially and socially disadvantaged sections of society.
    5. RISK MANAGEMENT
    5.1
    For Risk Management, the Company will have a risk based approach which includes the following:

    a) Customers shall be categorized as low, medium and high risk category, based on the assessment and risk perception of the Company;
    b) Risk categorization shall be undertaken based on parameters such as customer’s identity, social/financial status, nature of business activity, and information about the clients’ business and their location etc. While considering customer’s identity, the ability to confirm identity documents through online or other services offered by issuing authorities may also be factored in.
    c) The customers will be monitored on regular basis with built in mechanism for tracking irregular behavior for risk management and suitable timely corrective action.
    5.2 High and Medium Risk from AML perspective
    A customer that is likely to pose a higher than average risk may be categorized high or medium risk depending on background, nature & location of customer, his/ her profile, scale of customer’s volume, his/ her financials and social status etc. Due diligence measures will be applied based on the risk assessment. The Company shall apply enhanced due diligence measures for higher risk customers, especially those for whom the sources of funds are not clear.

    a) Indicative list of High Risk Customers
    i) Individuals and entities in various United Nations' Security Council Resolutions (UNSCRs) such as UN 1267 etc.;
    ii) Individuals or entities listed in the schedule to the order under section 51A of the Unlawful Activities (Prevention) Act, 1967 relating to the purposes of prevention of, and for coping with terrorist activities;
    iii) Individuals and entities in watch lists issued by Interpol and other similar international organizations;
    iv) Customers with dubious reputation as per public information available or commercially available watch lists;
    v) Individuals and entities specifically identified by regulators, FIU and other competent authorities as high-risk;
    vi) Customers conducting their business relationship or transactions in unusual circumstances, such as significant and unexplained geographic distance between the institution and the location of the customer, frequent and unexplained movement of accounts to different institutions, etc.;
    vii) Politically exposed persons (PEPs), customers who are close relatives of PEPs and accounts of which a PEP is the ultimate beneficial owner;
    viii) Non-face-to-face customers;
    ix) High net worth individuals;
    x) Firms with 'sleeping partners';
    xi) Companies having close family shareholding or beneficial ownership;
    xii) Complex business ownership structures, which can make it easier to conceal underlying beneficiaries, where there is no legitimate commercial rationale;
    xiii) Shell companies which have no physical presence in branch locations. The existence simply of a local agent or low level staff does not constitute physical presence;
    xiv) Accounts for "gatekeepers" such as accountants, lawyers, or other professionals for their clients where the identity of the underlying client is not disclosed;
    xv) Client Accounts managed by professional service providers such as law firms, accountants, agents, brokers, fund managers, trustees, custodians etc.;
    xvi) Trusts, charities, NGOs/ unregulated clubs and organizations receiving donations;
    xvii) Gambling/gaming including “Junket Operators” arranging gambling tours;
    xviii) Jewelers and Bullion Dealers;
    xix) Dealers in high value or precious goods (e.g. gem and precious metals dealers, art and antique dealers and auction houses, estate agents and real estate brokers);
    xx) Customers engaged in a business which is associated with higher levels of corruption (e.g., arms manufacturers, dealers and intermediaries;
    xxi) Customers engaged in industries that might relate to nuclear proliferation activities or explosives;
    xxii) Customers that may appear to be Multi-level marketing companies etc.
    b) Indicative list of Medium Risk Customers

    i) Stock brokerage;
    ii) Import / Export;
    iii) Gas Station;
    iv) Car / Boat / Plane Dealership;
    v) Electronics (wholesale);
    vi) Travel agency;
    vii) Telemarketers;
    viii) Providers of telecommunications service, internet café, International direct dialing (IDD) call service.
    5.3 Low Risk from AML perspective
    All other customers (other than High and Medium Risk category) whose identities and sources of wealth can be easily identified and by and large conform to the known customer profile, may be categorized as low risk. In such cases, only the basic requirements of verifying the identity and location of the customer are to be met.

    Illustrative examples of low risk customers could be:
    i. Salaried applicants whose salary structures are well defined;
    ii. People belonging to government departments,
    iii. People working with govt. owned companies, regulators and statutory bodies etc;
    iv. People belonging to lower economic strata of the society whose accounts show small balances and low turnover;
    v. People working with Public Sector Units;
    vi. People working with reputed Public Limited companies & Multinational Companies.
    6. CUSTOMER IDENTIFICATION PROCEDURES (CIP)

    i) The Company shall undertake identification of customers in the following cases:
    i) Commencement of an account-based relationship with the customer;
    ii) When there is a doubt about the authenticity or adequacy of the customer identification data it has obtained;
    iii) Selling their own products, selling third party products as agents and any other product for more than Rs.50,000/-.
    iv) Carrying out transactions for a non-account based customer (walk-in customer);
    ii) The Company shall obtain satisfactory evidence of the identity of the customer depending upon the perceived risks at the time of commencement of relationship/ opening of account. Such evidences shall be substantiated by reliable independent documents, data or information or other means like physical verification etc.
    iii) The Company will obtain Permanent account number (PAN) of customers as per the applicable provisions of Income Tax Rule 114B. Form 60 shall be obtained from persons who do not have PAN.
    iv) For the customers that are legal person or entities:
    i) the Company will verify the legal status for the legal person/ entity through proper and relevant documents;
    ii) the Company will understand the beneficial ownership and control structure of the customer and determine who are the natural persons who ultimately control the legal person.
    v) Additional documentation may be obtained from the customers with higher risk perception as may be deemed fit. This shall be done having regard but not limited to location (registered office address, correspondence address and other addresses as may be applicable), nature of business activity, repayment mode & repayment track record.
    vi) An indicative list of the nature and type of documents/ information that may be relied upon for customer identification is provided in the ‘Annexure A’ of this Policy. The documents to be accepted by the Company for customer identification shall be based on the regulatory prescriptions from time to time and shall be finalized after approval from the Compliance Officer, Principal Officer & Head- Risk and Credit.
    vii) For the purpose of verifying the identity of customers at the time of commencement of an account-based relationship, the Company, at its discretion may at its option, rely on customer due diligence done by a third party, subject to the following conditions:
    i) Necessary information of such customers’ due diligence carried out by the third party is immediately obtained by the Company;
    ii) Adequate steps are taken by the Company to satisfy that copies of identification data and other relevant documentation relating to customer due diligence shall be made available from the third party upon request without delay
    iii) The third party is regulated, supervised or monitored for, and has measures in place for, compliance with customer due diligence and record-keeping requirements in line with the requirements and obligations under the PML Act;
    iv) The third party shall not be based in a country/ jurisdiction assessed as high risk;
    v) The ultimate responsibility for customer due diligence and undertaking enhanced due diligence measures, as applicable, will be with the Company.
    viii) While undertaking customer identification, the Company will ensure that:
    i) Decision-making functions of determining compliance with KYC norms shall not be outsourced.
    ii) The customers shall not be required to furnish an additional OVD, if the OVD submitted for KYC contains proof of identity as well as proof of address.
    iii) The customers will not be required to furnish separate proof of address for permanent and current addresses, if these are different. In case the proof of address furnished by the customer is the address where the customer is currently residing, a declaration shall be taken from the customer about her/ his local address on which all correspondence will be made by the Company. The local address for correspondence, for which their proof of address is not available, shall be verified through ‘positive confirmation’ such as cheque books, ATM cards, telephonic conversation, positive address verification, Rent agreement, etc.
    iv) In case of change in the address mentioned on the ‘proof of address’, fresh proof of address should be obtained within a period of six months.

    7. CUSTOMER DUE DILIGENCE (CDD) PROCEDURE
    7.1 CDD Procedure in case of Individuals

    a) The Company will obtain the following documents from an individual while establishing an account based relationship:
    i) one certified copy of an OVD as defined above containing details of identity and address;
    ii) one recent photograph; and
    iii) such other documents pertaining to the nature of business or financial status specified by the Company.

    The information collected from customers for the purpose of opening of account shall be treated as confidential and details thereof shall not be divulged for the purpose of cross selling, or for any other purpose without the express permission of the customer. Submission of PAN or form 60 in lieu of PAN and Aadhaar is mandatory for all customers, to the extent applicable, unless it is specifically exempted under any law/act/regulations/notification/circular etc.
    b) The e-KYC service of Unique Identification Authority of India (UIDAI) shall be accepted as a valid process for KYC verification and the information containing demographic details and photographs made available from UIDAI as a result of e-KYC process will be treated as an ‘Officially Valid Document’.

    However, before commencing the e-KYC process, there should be explicit consent and authorization from the individual customer authorizing UIDAI to release his/ her identity/address through biometric authentication to the Company or its Business Correspondents (BCs).

    Further,the Company may also opt for One Time Pin (OTP) based e-KYC process for on-boarding of customers subject to the following conditions:
    i) There must be a specific consent from the customer for authentication through OTP.
    ii) Only term loans not exceeding Rs.60,000/- in a year will be eligible.
    iii) Accounts opened using OTP based e-KYC shall not be allowed for more than one year within which Customer Due Diligence (CDD) procedure as provided in preceding paragraph is to be completed. If the CDD procedure is not completed within a year, no further debits shall be allowed in the loan account.
    iv) A declaration shall be obtained from the customer to the effect that no other account has been opened nor will be opened using OTP based KYC either with the Company or with any other Bank/ NBFC/ HFC/ other entities regulated by RBI/ NHB. Further, while uploading KYC information to CKYCR, the Company will clearly indicate that such accounts are opened using OTP based e-KYC and other regulated entities shall not open accounts based on the KYC information of accounts opened with OTP based e-KYC procedure.
    v) The Company will have monitoring procedures including systems to generate alerts in case of any non-compliance/violation, to ensure compliance with the above mentioned conditions.
    c) The Company may print/download directly, the prospective customer’s e-Aadhaar letter from the UIDAI portal, if such a customer knows only his/her Aadhaar number or if the customer carries only a copy of Aadhaar downloaded from a place/source elsewhere, provided, the prospective customer is physically present in the branch of the Company.
    d) A copy of the marriage certificate issued by the State Government or Gazette notification indicating change in name together with a certified copy of the ‘officially valid document’ in the existing name of the person shall be obtained for proof of address and identity, while establishing an account based relationship or while undertaking periodic updation exercise in cases of persons who change their names on account of marriage or otherwise.;
    e) If a person who proposes to open an account does not have an OVD as ‘proof of address’, such person shall provide OVD of the relative as provided at sub-section 77 of Section 2 of the Companies Act, 2013, read with Rule 4 of Companies (Specification of definitions details) Rules, 2014, with whom the person is staying, as the ‘proof of address’;
    Explanation: A declaration from the relative that the said person is a relative and is staying with him/her shall be obtained. Here relative means relative as per Companies Act, 2013.
    f) If a customer categorised as ‘low risk’ expresses inability to complete the documentation requirements on account of any genuine reason, and where it is essential not to interrupt the normal conduct of business, the Company may, at its discretion, complete the verification of identity of the customer within a period of 6 months from the date of establishment of the relationship.
    g) In respect of customers who are categorized as ‘low risk’ and are not able to produce any of the OVDs mentioned, ‘simplified procedure’ may be applied, Explanation: During the periodic review, if the ‘low risk’ category customer for whom simplified procedure is applied, is re-categorized as ‘moderate or ‘’high’ risk category, then the Company shall obtain one of the six standard OVDs listed at para 3.10 above for proof of identity and proof of address immediately.
    h) If an existing KYC compliant customer of the Company desires to open another account with it, there shall be no need for a fresh CDD exercise provided there is no change in details last provided under the Company’s KYC norms.
    i) KYC verification once done by one branch/office of the Company shall be valid for transfer of the account to any other branch/office of it, provided full KYC verification has already been done for the concerned account and the same is not due for periodic updation and a self-declaration from the account holder about his/her current address is obtained in such cases.
    j) Simplified procedure (based on the prescriptions by RBI for opening of accounts by an NBFC): In case a person who desires to open an account is not able to produce OVD/ valid KYC documents, the Company may at its discretion open accounts subject to the following conditions:

    i) Introduction from another account holder who has been subjected to full KYC procedure shall be obtained.
    ii) The introducer’s account with the Company shall be at least 6 months old and shows satisfactory transactions.
    iii) Photograph of the customer who proposes to open the account and also his address shall be certified by the introducer, or any other evidence as to the identity and address of the customer to the satisfaction of the Company shall be obtained.
    iv) The total credit in all the accounts taken together shall not exceed Rs.1,00,000/- in a year.
    v) The customer shall be made aware that no further transactions will be permitted until full KYC procedure is completed in case of breach of the above limit.
    vi) When the total credit in a year reaches Rs.80,000/-, the customer shall be notified that appropriate documents for conducting the KYC must be submitted otherwise the operations in the account shall be stopped when the total credits in all the accounts taken together exceed the limit of Rs.1,00,000/- in a year.
    7.2 CDD Measures for Sole Proprietary firms

    a) For opening an account in the name of a sole proprietary firm, a certified copy of an OVD as mentioned above, containing details of identity and address of the individual (proprietor) shall be obtained. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of partnership firm is mandatory.
    b) In addition to the above, any two of the following documents as a proof of business/ activity in the name of the proprietary firm shall also be obtained:
    i) Registration certificate;
    ii) Certificate/ License issued by the municipal authorities under Shop and Establishment Act;
    iii) Sales and income tax returns;
    iv) CST/VAT certificate;
    v) Certificate/registration document issued by Sales Tax/Service Tax/Professional Tax authorities;
    vi) License/certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute;
    vii) Complete Income Tax Return (not just the acknowledgement) in the name of the sole proprietor where the firm's income is reflected, duly authenticated/acknowledged by the Income Tax authorities;
    viii) Utility bills such as electricity, water, and landline telephone bills.

    In cases where the Company is satisfied that it is not possible to furnish two such documents, it may accept only one of those documents as proof of business/ activity, subject to contact point verification and collection of such other information and clarification as would be required to establish the existence of such firm. Further, it should be satisfied that the business activity has been verified from the address of the proprietary concern.
    7.3 CDD Measures for Legal Entities

    a) For opening an account of a company, one certified copy of each of the following documents shall be obtained:
    i) Certificate of incorporation.
    ii) Memorandum and Articles of Association.
    iii) A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf.
    iv) Officially valid documents in respect of managers, officers or employees holding an attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of Company is mandatory.
    b) For opening an account of a partnership firm, one certified copy of each of the following documents shall be obtained:
    i) Registration certificate.
    ii) Partnership deed.
    iii) Officially valid documents in respect of the person holding an attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of partnership firm is mandatory.
    c) For opening an account of a trust, one certified copy of each of the following documents shall be obtained:
    i) Registration certificate.
    ii) Trust deed.
    iii) Officially valid documents in respect of the person holding a power of attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of trust is mandatory.
    d) For opening an account of an unincorporated association or a body of individuals, one certified copy of each of the following documents shall be obtained:
    i) Resolution of the managing body of such association or body of individuals;
    ii) Power of attorney granted to transact on its behalf;
    iii) Officially valid documents in respect of the person holding an attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on its behalf is mandatory, and
    iv) Such information as may be required by the Company to collectively establish the legal existence of such an association or body of individuals.
    Explanation: Unregistered trusts/partnership firms shall be included under the term ‘unincorporated association’.
    Explanation: Term ‘body of individuals’ includes societies.
    e) For opening accounts of juridical persons not specifically covered in the earlier part, such as Government or its Departments, societies, universities and local bodies like village panchayats, one certified copy of the following documents shall be obtained:
    i) Document showing name of the person authorised to act on behalf of the entity;
    ii) Officially valid documents for proof of identity and address in respect of the person holding an attorney to transact on its behalf; and
    iii) Such documents as may be required by the RE to establish the legal existence of such an entity/ juridical person.
    iv) PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of partnership firm is mandatory.
    7.4 Selling Third party products-
    The Company, if acting as agents while selling third party products as per regulations in force from time to time, will comply with the following aspects:

    a) The identity and address of the walk-in customer shall be verified for transactions above Rs.50,000/-fifty thousand as required under its CIP;
    b) Transaction details of sale of third party products and related records shall be maintained.
    c) Monitoring of transactions for any suspicious activity will be done.
    7.5 Enhanced Due Diligence

    a) Accounts of non-face-to-face customers: The Company will include additional procedures i.e., certification of all the documents presented, calling for additional documents and the first payment to be effected through the customer's KYC-complied account with another regulated entity for enhanced due diligence of non-face to face customers.
    b) Accounts of Politically Exposed Persons (PEPs): The Company will have the option of establishing a relationship with PEPs, provided that:
    i) sufficient information including information about the sources of funds accounts of family members and close relatives is gathered on the PEP;
    ii) the identity of the person shall have been verified before accepting the PEP as a customer;
    iii) the decision to open an account for a PEP is taken at a senior level in accordance with the Company’s Customer Acceptance Policy;
    iv) all such accounts are subjected to enhanced monitoring on an on-going basis;
    v) in the event of an existing customer or the beneficial owner of an existing account subsequently becoming a PEP, senior management’s approval is obtained to continue the business relationship;
    vi) the CDD measures as applicable to PEPs including enhanced monitoring on an on-going basis are applicable.

    The above will also be applicable to accounts where a PEP is the beneficial owner.

    For all the customers for which enhanced due diligence “EDD” is required, the Company will conduct the same in line with EDD policy of the group. Any deviation to group EDD policy will be entertained as an exception and will require approval of Principal Officer. Group Policy is enclosed as Annexure-B.
    7.6 Simplified Due Diligence

    a) For Self Help Groups (SHGs)
    i) KYC verification of all the members of SHG shall not be required while opening the savings bank account of the SHG.
    ii) KYC verification of all the office bearers shall suffice.
    iii) No separate KYC verification of the members or office bearers shall be necessary at the time of credit linking of SHGs
    7.7 Identification of Beneficial Owner
    For opening an account of a Legal Person who is not a natural person, the beneficial owner(s) shall be identified and all reasonable steps to verify his/her identity shall be undertaken keeping in view the following:
    a) Where the customer or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies.
    b) In cases of trust/ nominee or fiduciary accounts whether the customer is acting on behalf of another person as trustee/ nominee or any other intermediary is determined. In such cases, satisfactory evidence of the identity of the intermediaries and of the persons on whose behalf they are acting, as also details of the nature of the trust or other arrangements in place shall be obtained.
    8. MONITORING OF TRANSACTIONS/ ON-GOING DUE DILIGENCE
    Ongoing monitoring is an essential element of effective KYC procedures. The Company shall on-going due diligence of customers to ensure that their transactions are consistent with their knowledge about the customers, customers’ business and risk profile; and the source of funds.

    The Company shall identify transactions that fall outside the regular pattern of activity. However, the extent of monitoring will depend on the risk sensitivity of the account. The Company shall pay special attention to all complex, unusually large transactions and all unusual patterns which have no apparent economic or visible lawful purpose.
    8.1
    The Company will put in place a system of periodical review of risk categorization of accounts and the need for applying enhanced due diligence measures in case of higher risk perception on a customer. The Company will carry such review of risk categorization of customers at a periodicity of not less than once in six months.
    8.2 Periodic Updation-
    The Company will conduct periodic updation of KYC documents at least once in every two years for high risk customers, once in every eight years for medium risk customers and once in every ten years for low risk customers subject to the following conditions:
    a) Fresh proofs of identity and address shall not be sought at the time of periodic updation from customers who are categorised as ‘low risk’, when there is no change in status with respect to their identities and addresses and a self-certification to that effect is obtained.
    b) A certified copy of the proof of address forwarded by ‘low risk’ customers through mail/ post, etc., in case of change of address shall be acceptable.
    c) Physical presence of low risk customer at the time of periodic updation shall not be insisted upon.
    d) The time limits prescribed above would apply from the date of opening of the account/ last verification of KYC.
    e) Fresh photographs shall be obtained from customer for whom account was opened when they were minor, on their becoming a major.
    f) E-KYC process using OTP based authentication for periodic updation is allowed provided while on boarding, the customer was subjected to proper KYC process.
    9. REPORTING TO FINANCIAL INTELLIGENCE UNIT- INDIA
    9.1
    In accordance with the requirements under PMLA, the Company will furnish the following reports, as and when required, to the Director, Financial Intelligence Unit-India (FIU-IND):
    a) Cash Transaction Report (CTR)- If any such transactions detected, Cash Transaction Report (CTR) for each month by 15th of the succeeding month.
    b) Counterfeit Currency Report (CCR)- All such cash transactions where forged or counterfeit Indian currency notes have been used as genuine as Counterfeit Currency Report (CCR) for each month by 15th of the succeeding month.
    c) Suspicious Transactions Reporting (STR)- The Company will endeavor to put in place automated systems for monitoring transactions to identify potentially suspicious activity. Such triggers will be investigated and any suspicious activity will be reported to FIU-IND.

    The Company will file the Suspicious Transaction Report (STR) to FIU-IND within 7 days of arriving at a conclusion that any transaction, whether cash or non-cash, or a series of transactions integrally connected are of suspicious nature. However, in accordance with the regulatory requirements, the Company will not put any restriction on operations in the accounts where an STR has been filed. An indicative list of suspicious transactions is enclosed as Annexure-C.
    9.2 Confidentiality and Prohibition against disclosing Suspicious Activity Investigations and Reports-
    The Company will maintain utmost confidentiality in investigating suspicious activities and while reporting CTR/ CCR/ STR to the FIU-IND/ higher authorities. However, the Company may share the information pertaining to the customers with the statutory/ regulatory bodies and other organizations such as banks, credit bureaus, income tax authorities, local government authorities etc.
    10. SHARING KYC INFORMATION WITH CENTRAL KYC RECORDS REGISTRY (CKYCR)
    The Company will capture the KYC information for sharing with the CKYCR in the manner as prescribed in the Prevention of Money Laundering (Maintenance of Records) Rules, 2005, under the prescribed KYC templates for ‘individuals’ and ‘Legal Entities’ as applicable. Further, the Company will upload the KYC data pertaining to all types of prescribed accounts with CKYCR, as and when required, in terms of the provisions of the Prevention of Money Laundering (Maintenance of Records) Rules, 2005.
    11. REPORTING REQUIREMENT UNDER FOREIGN ACCOUNT TAX COMPLIANCE ACT (FATCA) AND COMMON REPORTING STANDARDS (CRS)
    If applicable to the Company, it will adhere to the provisions of Income Tax Rules 114F, 114G and 114H. If the Company becomes a Reporting Financial Institution as defined in Income Tax Rule 114F, it will take the following requisite steps for complying with the reporting requirements:

    d) Register on the related e-filling portal of Income Tax Department as a Reporting Financial Institution;
    e) Submit online reports by using the digital signature of the ‘Designated Director’ by either uploading the Form 61B or ‘NIL’ report, for which, the schema prepared by Central Board of Direct Taxes (CBDT) shall be referred to;
    f) Develop Information Technology (IT) framework for carrying out due diligence procedure and for recording and maintaining the same, as provided in Rule 114H;
    g) Develop a system of audit for the IT framework and compliance with Rules 114F, 114G and 114H of Income Tax Rules.;
    h) Constitute a “High Level Monitoring Committee” under the Designated Director or any other equivalent functionary to ensure compliance;
    i) Ensure compliance with updated instructions/ rules/ guidance notes/ Press releases/ issued on the subject by Central Board of Direct Taxes (CBDT) from time to time.

    12. INDEPENDENT EVALUTION
    To provide reasonable assurance that its KYC and AML procedures are functioning effectively, an audit of its KYC and AML processes will covered under Internal Audit of the Company.
    The audit findings and compliance thereof will be put up before the Audit Committee of the Board on quarterly intervals till closure of audit findings.
    13. RESPONSIBILITIES OF THE SENIOR MANAGEMENT
    13.1 Designated Director-
    The Company shall nominate a “Designated Director” to ensure compliance with the obligations prescribed by the PMLA and the Rules thereunder. The “Designated Director” can be a person who holds the position of senior management or equivalent. However, it shall be ensured that the Principal Officer is not nominated as the “Designated Director”.
    13.2 Principal Officer-
    An official (having knowledge, sufficient independence, authority, time and resources to manage and mitigate the AML risks of the business) shall be designated as the Principal Officer of the Company. The Principal Officer will responsible for ensuring compliance, monitoring transactions, and sharing and reporting information as required under the law/ regulations.
    13.3 Key Responsibilities of the senior management

    i) Ensuring overall compliance with regulatory guidelines on KYC/ AML issued from time to time and obligations under PMLA.
    ii) Proper implementation of the company’s KYC & AML policy and procedures.
    14. RECORD MANAGEMENT
    14.1 Record-keeping requirements-
    The Company shall introduce a system of maintaining proper record of transactions required under PMLA as mentioned below:
    a) all cash transactions of the value of more than Rs.10 lakh or its equivalent in foreign currency;
    b) all series of cash transactions integrally connected to each other which have been individually valued below Rs.10 lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the monthly aggregate exceeds Rs.10 lakh or its equivalent in foreign
    c) all cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine and where any forgery of a valuable security or a document has taken place facilitating the transactions;
    d) all suspicious transactions whether or not made in cash; and
    e) records pertaining to identification of the customer and his/her address; and
    f) should allow data to be retrieved easily and quickly whenever required or when requested by the competent authorities.
    14.2 Records to contain the specified information-
    The records should contain the following information:
    a) the nature of the transactions;
    b) the amount of the transaction and the currency in which it was denominated;
    c) the date on which the transaction was conducted; and
    d) the parties to the transaction.
    14.3 Maintenance and Preservation of records

    a) maintain for at least 5 years from the date of transaction between the Company and the client, all necessary records of transactions referred in para 13.1 above;
    b) maintain for at least 5 years from the date of transaction between the Company and the client, all necessary records of transactions which will permit reconstruction of individual transactions so as to provide, if necessary, evidence for prosecution of persons involved in criminal activity;
    c) records pertaining to the identification of the customer and his address (e.g. copies of documents like passports, identity cards, driving licenses, PAN card etc.) obtained while opening the account and during the course of business relationship would continue to be preserved for at least 5 years after the business relationship is ended;
    d) records may be maintained either in hard or soft format.
    15. HIRING OF EMPLOYEES, THEIR TRAINING AND EDUCATION OF CUSTOMERS
    15.1 Hiring of Employees and Employee training-
    Adequate screening mechanism as an integral part of their personnel recruitment/hiring process shall be put in place. On-going employee training programme will be put in place so that the members of staff are adequately trained in KYC & AML policy.
    15.2
    Implementation of KYC Procedures requires the Company to seek information which may be of personal nature or which has hitherto never been called for. This can sometimes lead to a lot of questioning by the customer as to the motive and purpose of collecting such information. To meet such situation, it is necessary that the customers are educated and apprised about the sanctity and objectives of KYC procedures so that the customers do not feel hesitant or have any reservation while passing on the information to the Company. To educate the customers, the Company will arrange FAQs on KYC and AML measures. Such FAQs may be made available to the customers directly, on request, or through the Company’s website.
    16. Procedure for freezing of funds, financial assets or economic resources or related services

    i. By virtue of Section 51A of UAPA, the Central Government is empowered to freeze, seize or attach funds of and/or prevent entry into or transit through India any individual or entities that are suspected to be engaged in terrorism.
    ii. Reporting entities shall follow the procedure prescribed by respective regulators for freezing of accounts of designated individuals/entities in case any customer records are matched with that of designated individuals/ entities.
    iii. Reporting entities shall comply with the procedure prescribed by respective regulators for unfreezing of accounts of ‘designated individuals/entities’ in case of individuals/entities inadvertently affected by the freezing mechanism, upon verification that the individual/ entity is not a designated individual/entity.
    iv. Reporting entities shall comply with the procedure prescribed by respective regulator for implementation of requests received for freezing of insurance policies of ‘designated individuals/entities’ without prior notice to the designated persons involved.
    Annexure A

    Indicative List of Customer Identification Documents

    Features Documents
    Accounts of individuals
    Proof of Identity/ Address
    Copy of any one of the following:

    i) Passport (Not Expired)
    ii) PAN Card or Form 60 as applicable as per the policy-Mandatory
    iii) Voter’s Identity Card issued by Election Commission
    iv) Driving License (Not Expired)
    v) Job Card issued by NREGA duly signed by an officer of the State Govt.
    vi) The letter issued by the Unique Identification Authority of India (UIDAI) containing details of name, address and Aadhaar number or Aadhar Card-Mandatory
    vii) Details from obtained through e-KYC service of Unique Identification Authority of India (UIDAI).

    Where ‘simplified measures’ are applied for verifying the identity of customers the following documents shall be deemed to be 'officially valid documents:
    i) identity card with applicant's Photograph issued by Central/State Government Departments, Statutory/Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions;
    ii) letter issued by a gazetted officer, with a duly attested photograph of the person.

    Where ‘simplified measures’ are applied for verifying for the limited purpose of proof of address the following additional documents are deemed to be OVDs
    i) Utility bill which is not more than two months old of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill);
    ii) Property or Municipal Tax receipt;
    iii) Bank account or Post Office savings bank account statement;
    iv) Pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address;
    v) Letter of allotment of accommodation from employer issued by State or Central Government departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies. Similarly, leave and license agreements with such employers allotting official accommodation; and
    vi) Documents issued by Government departments of foreign jurisdictions and letter issued by Foreign Embassy or Mission in India When address in Aadhaar is different from current address, the Company will obtain an additional OVD or document as specified under simplified measures.
    Accounts of Companies i) Certificate of incorporation;
    ii) Memorandum and Articles of Association;
    iii) A resolution from the Board of Directors and power of attorney granted to managers, officers or employees to transact on its behalf; and
    iv) An officially valid document in respect of managers, officers or employees holding an attorney to transact on its behalf.

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on behalf of Company is mandatory. PAN and Aadhaar for UBO is also required to be obtained.
    Accounts of Partnership firms i) Registration certificate;
    ii) Partnership deed; and
    iii) An officially valid document in respect of the person holding an attorney to transact on its behalf.

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on behalf of Firm is mandatory.
    Accounts of Trusts and foundations i) Registration certificate;
    ii) Trust deed; and
    iii) An officially valid document in respect of the person holding a power of attorney to transact on its behalf

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on behalf of trust is mandatory.
    Accounts of unincorporated association or a body of individuals i) Resolution of the managing body of such association or body of individuals;
    ii) Power of attorney granted to him to transact on its behalf;
    iii) An officially valid document in respect of the person holding an attorney to transact on its behalf; and
    iv) Such information as may be required by the bank to collectively establish the legal existence of such an association or body of individuals.

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on its behalf is mandatory.
    Accounts of Proprietorship Concerns
    Proof of the name, address and activity of the concern
    Apart from Customer identification procedure as applicable to the proprietor any two of the following documents in the name of the proprietary concern would suffice:
  • Registration certificate (in the case of a registered concern)
  • Certificate/licence issued by the Municipal authorities under Shop & Establishment Act,
  • Sales and income tax returns
  • CST/VAT certificate  Certificate/registration document issued by GST/Sales Tax/Service Tax/Professional Tax authorities
  • IEC (Import Export Code) issued to proprietary concern by the office of DGFT.
  • Licence/certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute.
  • The complete Income Tax return (not just the acknowledgement) in the name of the sole proprietor where the firm's income is reflected, duly authenticated/ acknowledged by the Income Tax Authorities.
  • Utility bills such as electricity, water and landline telephone bills However, in cases where the Company is satisfied that, for any proposal, the proprietary concern is not possible to furnish two such documents, the Company will have the discretion to accept only one of those documents as activity proof. In such cases, the Company, however, will undertake contact point verification, collect such information as would be required to establish the existence of such firm, confirm, clarify and satisfy themselves that the business activity has been verified from the address of the proprietary concern.
  • Annexure-B

    Enhanced Due Diligence Policy

    Introduction:
    The cornerstone of a strong Anti Money Laundering program is the adoption and implementation of comprehensive customer due diligence policies, procedures, and processes for all customers, particularly those that present a higher risk for money laundering and terrorist financing. As a result, due diligence procedures and processes should be enhanced for such high risk customers. Enhanced Due Diligence (EDD) for High Risk Customers including Politically Exposed Persons (PEPs) and Clients of Special Category (CSC) is especially critical in understanding their transactions and implementing a monitoring system that reduces the Group’s regulatory and reputational risks. High risk customers and their transactions should be reviewed more closely at account opening and more frequently throughout the term of their relationship. Regulators like SEBI, IRDAI, RBI, etc. have also continuously emphasised on the need to carry out enhanced due diligence for such high risk customers. High Risk customer/CSC: A High Risk customer/CSC would typically be persons/entities that by nature of their occupation, place of residence or any other characteristic, are more vulnerable to money laundering. Below is the list for classifying a customer as high risk customer/CSC:
  • Non Resident clients
  • High Net-worth Individuals (each entity to define threshold for HNI)
  • Trusts, Charities, NGOs and organizations receiving donations
  • Politically Exposed Persons (PEP) as defined in the AML Policy
  • Companies undertaking Forex Business
  • Clients in high risk countries where existence / effective money laundering controls is suspect, where there is unusual banking secrecy, countries active in narcotics production, countries where corruption (as per Transparency International Corruption Perception Index) is highly prevalent, countries against which government sanctions are applied, countries reputed to be any of the following - havens/ sponsors of international terrorism, offshore financial centers, tax havens, countries where fraud is highly prevalent.
    {Note: click the following link for list of high risk countries as published by FATF - http://www.fatf-gafi.org/countries/#high-risk }
  • Non face to face clients, if any
  • Clients with dubious reputation as per public information available etc.

  • Apart from above, when establishing business relationship with a customer, the entity should further classify the customer as High Risk/CSC customer by assessing the following risk categories:
  • risk associated with the legal form of the customer (eg. companies having close family shareholding, partnership firm with sleeping partners, etc.);
  • risk associated with the economic or personal activity of the customer (eg. person/entity carrying out cash incentive business like restaurant business, dealing in arms, etc.);
  • risk associated with the products or services used by the customer (eg. single premium insurance policy where the money is invested in lump sum and surrendered at the earliest opportunity, etc.)
  • Businesses shall exercise independent judgment to ascertain whether any other set of clients shall be classified as High Risk customer/CSC or not. Apart from conducting the basic KYC as per the requirement of the respective business, the entity shall perform EDD for customers who are classified as High Risk Customer / CSC.

    Enhanced Due Diligence (EDD):

    EDD shall comprise the following:
    1. EDD needs to be undertaken at inception of business relationship with a customer.
  • Laying down reasonable measures to understand whether customer’s source of income and net worth is commensurate with the assessed risk of the customer profile. In this regard, any one of the documents as mentioned in Annexure A can be obtained. This is an illustrative list and entities may obtain any additional documents for verifying source of income and net worth in consultation with GCG team.
  • Basis the above document, Relationship Manager (RM)/Customer facing team to provide report on customer profile. Report to contain customer details like occupation, net worth, income details, beneficial ownership details (in case of non individual accounts), etc.


  • Post conducting above due diligence and completion of KYC requirement, approval of senior official shall be taken for on-boarding high risk customer/CSC. Operations team in consultation with relationship manager to provide customer details to the senior official in Annexure B, seeking their approval to on-board the customer.

    Each business shall define the approval hierarchy for such High Risk customer/CSC jointly with GCG.

    For PEP cases, approval of CCG Head shall additionally be taken. Post obtaining approval for High Risk customer/CSC, customer can be on-boarded, subject to any other business specific requirement.

    2. EDD to be performed during business relationship by taking below steps:
  • More frequent review of the customer’s profile/transactions, which shall be more stringent for High risk customer/CSC. In this regard, each business unit to formulate its own parameters considering the regulatory requirement jointly with GCG.
  • Updation of KYC shall be done at higher frequency for High risk customer/CSC accounts as specified by the regulator.

    Above EDD process is not intended to be exhaustive, businesses may adopt a more stringent EDD process as per their requirements and regulatory guidelines.

    Change in Customer categorisation:
  • Where there is change in customer categorisation to high risk/CSC basis review of customer’s transaction and profile, EDD process as mentioned above shall be carried out.
  • Further approval of senior official as per the hierarchy mentioned above shall be taken to continue relationship with such customer.
  • In case of PEP, approval of CCG Head shall additionally be obtained to continue business relationship with such PEP.

  • Annexure A

    Illustrative list of Income Proofs

    Income proofs for Individuals:

    1. Latest copy of Income tax assessment orders/ Income Tax returns slips
    2. Form 16 in case of employed individual
    3. Latest Salary slip from employer
    4. Bank statement showing income credit like salary Income, rent income, etc.
    5. Mandi receipt for Agricultural Income
    6. CA certificate on client’s Income/Net Worth
    7. Registered Rent Agreement

    Income Proofs for Non-Individuals:

    1. Latest copy of Income tax assessment orders/ Income Tax returns slips
    2. Latest copy of Audited Statements
    3. Annual Report
    4. Chartered Accountant's certificate on client’s Income/Net Worth

    Annexure B
    Basic Client Information
    SBU
    LOB
    Sub-Lob
    EW Legal Entity
    Customer First Name
    Customer Last Name
    Type of High Risk Customer/ CSC (eg. HNI, NRI, PEP, etc.)
    Why classified as High Risk Customer/CSC/PEP
    Date of Birth
    Place of Birth
    Address:
    National ID/PAN No.
    Other ID
    Passport #
    Action initiated by any enforcement agency
    Are there any sanctions Imposed
    Criminal History if any
    Any adverse news
    Any Additional Information
    Enhance Due Diligence Details
    Customer’s Income (as per Income proofs submitted)
    Whether source of income/asset ownership document submitted like ITR, Salary Slip, Form 16, Audited financial statement, etc. (Yes/No)
    Source of Income document submitted by customer independently verified (Yes/No)
    Relationship manager report submitted (Yes/No)
    Basis of recommendation:
    Annexure C

    Indicative list of suspicious transactions are as below:

  • Customer did not open account after being informed about KYC requirements
  • Submission of false Identification Documents.
  • Customer holding multiple PAN.
  • Customer uses aliases and a variety of similar but different addresses.
  • Name of customer indicated differently in different KYC documents enabling creation of multiple customer identities.
  • The customer is reluctant to meet in person, represents through a third party/Power of Attorney holder without sufficient reasons.
  • Address provided by the customer is found to be non- existent.
  • Changes in mailing address of the Customer more than twice in last 6 months
  • The customer details matched with watch lists (e.g. UN list, Interpol list etc.)
  • Customer shows income from “foreign sources” on loan application without providing proper documentation.
  • Multiple addresses reflecting against the name of the customer which has not been shared / or does not match with the employment history / residence details provided.
  • Customer appears to have recently established a series of new relationships with different financial entities.
  • Encashment of loan amount by opening a fictitious bank account.
  • Suggesting dubious means for the sanction of loan
  • Cash payment shown as consideration paid to the seller for purchase of a property and the source of which cannot be explained or proof not provided by the customer.
  • Customer buys back a property that he or she recently sold without justification
  • Usage of loan amount by the customer in connivance with the vendor/builder/developer/broker/agent etc. and using the same for a purpose other than what has been stipulated.
  • Valuation of property shown considerably lower in the sale deed than the government approved rate / RESIDEX, especially on sale deeds executed within a period of 12 months.
  • Specifically in cases where the source is specified as "Funds from Family" and the customer fails or refuses to divulge any information or proof on where the concerned family member is providing the funds from.
  • Customer buys back a property that he or she recently sold without justification
  • Builder approaching the HFC for a small loan compared to the total cost of the project
  • Builder is unable to explain the sources of funding for the project
  • Approvals/sanctions from various authorities are proved to be fake
  • Customer offers different identifications on different occasions with
  • an apparent attempt to avoid linkage of multiple transactions.
  • Such other items specified in the list issued by NHB/RBI/FIU and other regulators
  • Policy on Know Your Customer & Anti Money Laundering Measures


    1. SCOPE

    1.1 Applicability
    The Know Your Customer and Anti-Money Laundering (the Policy) applies to Edelweiss Housing Finance Limited (hereinafter referred to as ‘the Company’ or ‘EHFL’).
    This Policy requires the Company and each employee to:
  • Protect the Company from being used for money laundering or funding terrorist activities;
  • Conduct themselves in accordance with the highest ethical standards;
  • Comply with the letter and the spirit of applicable Anti-Money Laundering (AML) Laws, and the Company’s KYC and AML procedures;
  • Be alert to and escalate suspicious activity and not knowingly provide advice or other assistance to individuals who attempt to violate or avoid money-laundering laws, or this Policy; and
  • Co-operate with the regulatory authorities and the Financial Intelligence Unit as per the applicable laws.

  • 1.2 Effective Date
    This revised Policy shall be effective from November 2, 2017.

    1.3 Review of Policy
    The Policy shall be reviewed annually or as and when required by the applicable rules and regulations.

    1.4 Implementation & Monitoring of Policy
    The Risk Management Committee (RMC) shall supervise the implementation of the Policy.

    1.5 Policy Approval
    The Policy and any significant changes therein shall be approved by the Board of Directors or the Audit Committee of the Company.
    2. BACKGROUND
    Money laundering refers to concealing or disguising the origin and ownership of the proceeds from criminal activity, including drug trafficking, public corruption, terrorism, fraud, human trafficking, and organized crime activities. Terrorist financing is the use of legally or illegally obtained funds to facilitate terrorist activities. Money laundering and terrorist financing may involve a wide variety of financial products, services, and transactions including lending and investment products, and the financing of equipment and other property that could be used to facilitate terrorism and other criminal activity.

    Almost any crime with a profit motive can create proceeds that can be laundered. For example, fraud, theft, illegal drug sales, organized crime, bribery, corruption of government officials and human trafficking can create illegal funds that a criminal seeks to convert into legitimate property without raising suspicion. Tax evasion and violations of fiscal laws can also lead to money laundering.

    Generally, the money laundering process involves three stages: placement, layering and integration. As illegal funds move from the placement stage through the integration stage, they become increasingly harder to detect and trace back to the illegal source.
  • Placement is the point where illegal funds first enter the financial system. The deposit of illegal cash into an account or the purchase of money orders, cashier’s checks or other financial product is made. Non-bank financial institutions, such as currency exchanges, money remitters, casinos, and check-cashing services can also be used for placement.
  • Layering After illegal funds have entered the financial system, layers are created by closing and opening accounts, purchasing and selling various financial products, transferring funds among financial institutions and across national borders. The criminal’s goal is to create layers of transactions to make it difficult to trace the illegal origin of the funds.
  • Integration occurs when the criminal believes that there are sufficient number of layers hiding the origin of the illegal funds to safely invest the funds or apply them towards purchasing valuable property in the legitimate economy.

  • A financial institution or other business may be used at any point in the money laundering process. There are many schemes that can be utilized to launder money and no financial institution or business is immune from possible victimization.

    To address money laundering, the Government of India and other countries around the world have made money laundering a crime and prescribed regulatory requirements for compliance by the banks, financial companies/ institutions and other regulated/ reporting entities to prevent and detect money laundering. In India and in many other countries, it is a crime to engage in a transaction with knowledge that the funds involved in the transactions are from illegal activity. Knowledge includes the concept of ‘willful blindness’ (failure to make appropriate inquiries when faced with suspicion of wrongdoing) and ‘conscious avoidance of knowledge’.

    To prevent money-laundering in India and to provide for confiscation of property derived from, or involved in, money-laundering and related matters, the Parliament of India enacted the Prevention of Money Laundering Act, 2002 (PMLA), as amended from time to time. Further, necessary Notifications / Rules under the said Act have been published and amended by the Ministry of Finance, the Government of India.

    As per the Prevention of Money Laundering Act 2002, the offence of Money Laundering is defined as:
    “Whosoever directly or indirectly attempts to indulge or knowingly assists or knowingly is a party or is actually involved in any process or activity connected with the proceeds of crime and projecting it as untainted property shall be guilty of offence of money-laundering. "Proceeds of crime" means any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to scheduled offence or the value of any such property.”

    The PMLA and rules notified thereunder impose obligation on banking companies, financial institutions (which includes chit fund company, a co-operative bank, a non-banking financial company and a housing finance institution) and intermediaries which includes a stock-broker, sub-broker, share transfer agent, banker to an issue, trustee to a trust deed, registrar to an issue, merchant banker, underwriter, portfolio manager, investment adviser etc. to verify identity of clients, maintain records and furnish requisite information to Financial Intelligence Unit- India (FIU-IND). The PMLA defines money laundering offence and provides for the freezing, seizure and confiscation of the proceeds of crime.

    In line with relevant NHB policy Circular & Know Your Customer & Anti Money Laundering Measures and any amendment thereof, and The Reserve Bank of India (RBI) vide Master Direction DBR.AML.BC.No.81/14.01.001/2015-16 dated February 25 2016 and subsequent modifications thereof, the policy has been reviewed.

    The KYC and AML Policy has been prepared considering the following 5 key elements:

    a) To lay down the criteria for Customer Acceptance (CAP);
    b) Risk Management;
    c) To lay down criteria for Customer Identification Procedures (CIP);
    d) To establish procedures for monitoring of transactions as may be applicable;
    e) To develop measures for educating employees and customers in regard with KYC.
    3. DEFINITIONS
    For the purpose of KYC Norms, definition of various terms used is as under:
    3.1 Beneficial Owner (BO)
  • Where the customer is a company, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have a controlling ownership interest or who exercise control through other means. Explanation- For the purpose of this sub-clause-

  • i) “Controlling ownership interest” means ownership of/entitlement to more than 25 per cent of the shares or capital or profits of the company.
    ii) “Control” shall include the right to appoint majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements.
  • Where the customer is a partnership firm, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have ownership of/entitlement to more than 15 per cent of capital or profits of the partnership.
  • Where the customer is an unincorporated association or body of individuals, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has/have ownership of/entitlement to more than 15 per cent of the property or capital or profits of the unincorporated association or body of individuals.

    Explanation: Term ‘body of individuals’ includes societies. Where no natural person is identified under (a), (b) or (c) above, the beneficial owner is the relevant natural person who holds the position of senior managing official.
  • Where the customer is a trust, the identification of beneficial owner(s) shall include identification of the author of the trust, the trustee, the beneficiaries with 15% or more interest in the trust and any other natural person exercising ultimate effective control over the trust through a chain of control or ownership.

  • 3.2 Cash Transaction Report (CTR)-
    CTR should include the following:
  • all cash transactions of the value of more than Rs.10 lakh or its equivalent in foreign currency;
  • all series of cash transactions integrally connected to each other which have been individually valued below Rs.10 lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the monthly aggregate exceeds Rs.10 lakh or its equivalent in foreign currency


  • 3.3 Central KYC Records Registry (CKYCR)
    means an entity defined under Rule 2(1)(aa) of Prevention of Money-Laundering (Maintenance of Records) Rules, 2005, to receive, store, safeguard and retrieve the KYC records in digital form of a customer.

    3.4 Counterfeit Currency Transaction
    All cash transactions, where forged or counterfeit Indian currency notes have been used as genuine. These cash transactions should also include transactions where forgery of valuable security or documents has taken place.

    3.5 Customer
    For the purpose of KYC Norms, a ‘Customer’ is defined as a person who is engaged in a financial transaction or activity with a reporting entity and includes a person on whose behalf the person who is engaged in the transaction or activity, is acting.

    3.6 Customer Due Diligence (CDD)-
    Identifying and verifying the customer and the beneficial owner using ‘Officially Valid Documents’ as a ‘proof of identity’ and a ‘proof of address’.

    3.7 Designated Director
    Designated Director" means a person designated by the RE to ensure overall compliance with the obligations imposed under chapter IV of the PML Act and the Rules and shall include:-

    a. the Managing Director or a whole-time Director, duly authorized by the Board of Directors, if the RE is a company,
    b. the Managing Partner, if the RE is a partnership firm,
    c. the Proprietor, if the RE is a proprietorship concern
    d. the Managing Trustee, if the RE is a trust
    e. person or individual, as the case may be, who controls and manages the affairs of the RE, if the RE is an unincorporated association or a body of individuals, and
    f. a person who holds the position of senior management or equivalent designated as a 'Designated Director’ in respect of Cooperative Banks and Regional Rural Banks.

    Explanation. - For the purpose of this clause, the terms "Managing Director" and "Whole-time Director" shall have the meaning assigned to them in the Companies Act, 2013.

    3.8 KYC Templates
    means templates prepared to facilitate collating and reporting the KYC data to the CKYCR, for individuals and legal entities, as required by the relevant Rules.

    3.9 Non-face-to-face customers
    Customers who open accounts without visiting the branch/ offices of the Company or meeting its officials.

    3.10 Officially valid document (OVD)-
    Any document notified/ advised by the Central Government/ Reserve Bank of India as officially valid document for verifying identity and proof of address of customers.

    As on date, OVD means the passport, the Driving License, the Permanent Account Number (PAN) Card, the Voter's Identity Card issued by the Election Commission of India, Job Card issued by NREGA duly signed by an officer of the State Government, Letter issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number.

    Explanation: Customers, at their option, shall submit one of the six OVDs for proof of identity and proof of address.

    Further, information provided through prescribed e-KYC process will also be treated as an ‘Officially Valid Document’ and will be a valid process for KYC verification.

    If ‘simplified measures’ (only for customers who are rated as low risk by the Company and who do not possess any of the six officially valid documents) are applied for verifying the identity of the customers then the following documents are deemed to be OVD:


    i) Identity card with applicant’s photograph issued by Central/ State Government Departments, Statutory/ Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions;
    ii) Letter issued by a Gazetted officer, with a duly attested photograph of the person.

    For such ‘simplified measures’, the following additional documents are deemed to be OVDs for proof of address:
    i) Utility bill, which is not more than two months old, of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill);
    ii) Property or Municipal Tax receipt;
    iii) Bank account or Post Office savings bank account statement;
    iv) Pension or family Pension Payment Orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address;
    v) Letter of allotment of accommodation from employer issued by State or Central Government departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies. Similarly, leave and license agreements with such employers allotting official accommodation; and
    vi) Documents issued by Government departments of foreign jurisdictions or letter issued by Foreign Embassy or Mission in India.

    3.11 On-going Due Diligence
    Regular monitoring of transactions in accounts to ensure that they are consistent with the customers’ profile and source of funds.

    3.12 Periodic Updation
    means steps taken to ensure that documents, data or information collected under the CDD process is kept up-to-date and relevant by undertaking reviews of existing records at periodicity prescribed by the NHB, the PMLA and the Rules thereunder.

    3.13 Politically Exposed Persons
    Individuals who are or have been entrusted with prominent public functions, e.g., Heads of States/Governments, senior politicians, senior government/ judicial/military officers, senior executives of state-owned corporations, important political party officials etc. Broadly it can be categorized into:
    a. Foreign PEPs: Individuals who are or have been entrusted with prominent public functions by a foreign country, for example Heads of State or of government, senior politicians, senior government, judicial or military officials, senior executives of state owned corporations, important political party officials
    b. Domestic PEPs: Individuals who are or have been entrusted domestically with prominent public functions, for example Heads of State or of government, senior politicians, senior government, judicial or military officials, senior executives of state owned corporations, important political party officials
    c. International organization PEPs: persons who are or have been entrusted with a prominent function by an international organization, refers to members of senior management or individuals who have been entrusted with equivalent functions, i.e. directors, deputy directors and members of the board or equivalent functions
    d. Family members are individuals who are related to a PEP either directly or through marriage or similar forms of partnership.
    e. Close associates are individuals who are closely connected to a PEP, either socially or professionally.
    3.14 Principal Officer (PO)-
    An official designated by the Board of Directors of the Company for overseeing and managing the KYC & AML policies and processes. The PO will be responsible for ensuring compliance, monitoring transactions, and sharing and reporting information as required under the law/regulations.

    3.15 ‘Senior Management’
    for the purpose of KYC compliance shall include Designated Director, Head Credit & Risk, Business Head, Head of Compliance, Principal Officer (PO) and his supervisor.

    3.16 Simplified procedure
    means the procedure for undertaking customer due diligence in respect of customers, who are rated as low risk by the RE and who do not possess any of the six officially valid documents, with the alternate documents prescribed under the para 3.10 above.

    3.17 Suspicious transaction
    means a “transaction” as defined below, including an attempted transaction, whether or not made in cash, which, to a person acting in good faith:

    a) gives rise to a reasonable ground of suspicion that it may involve the proceeds of crime, regardless of the value involved; or
    b) appears to be made in circumstances of unusual or unjustified complexity; or
    c) appears to have no economic rationale or bona fide purpose; or
    d) gives rise to a reasonable ground of suspicion that it may involve financing of the activities relating to terrorism.

    Explanation: Transaction involving financing of the activities relating to terrorism includes transaction involving funds suspected to be linked or related to, or to be used for terrorism, terrorist acts or by a terrorist, terrorist organization or those who finance or are attempting to finance terrorism.
    3.18 Transaction
    means a purchase, sale, loan, pledge, gift, transfer, delivery or the arrangement thereof and includes:

    a) opening of an account;
    b) deposits, withdrawal, exchange or transfer of funds in whatever currency, whether in cash or by cheque, payment order or other instruments or by electronic or other non-physical means;
    c) the use of a safety deposit box or any other form of safe deposit;
    d) entering into any fiduciary relationship;
    e) any payment made or received in whole or in part of any contractual or other legal obligation;
    f) establishing or creating a legal person or legal arrangement.

    3.19 Walk-in Customer
    means a person who does not have an account based relationship with the Company, but undertakes transactions with the Company.

    3.20 Person
    Person” has the same meaning assigned in the Act and includes:
    a. an Individual
    b. A Hindu Undivided Family,
    c. A Company
    d. A Firm
    e. an association of persons or a body of individuals, whether incorporated or not,
    f. every artificial juridical person, not falling within any one of the above persons (a to e), and
    g. any agency, office or branch owned or controlled by any of the above persons (a to f).

    4. CUSTOMER ACCEPTANCE POLICY (CAP)
    In line with the various guidelines issued by NHB on “Know Your Customer Guidelines & Anti Money Laundering Standards” and provisions of the PMLA, the Company has formulated Customer Acceptance Policy (CAP) which lays down the broad criteria for acceptance of customers.

    The features of the CAP are detailed below:
    a) The Company shall not open any account(s) in anonymous, fictitious or 'benami' name(s).
    b) No account is opened where the Company is unable to apply appropriate CDD measures, either due to non-cooperation of the customer or non-reliability of the documents/ information furnished by the customer.
    c) No transaction or account based relationship will be undertaken without following the CDD procedure.
    d) The mandatory information to be sought for KYC purpose while opening an account and during the periodic updation will be specified
    e) ‘Optional’/additional information is obtained with the explicit consent of the customer after the account is opened.
    f) CDD Procedure will be followed for all the joint account holders, while opening a joint account.
    g) Circumstances in which, a customer is permitted to act on behalf of another person/entity, is clearly spelt out.
    h) The Company shall ensure that the identity of the customer does not match with any person with known criminal background or with banned entities such as individual terrorists or terrorist organizations, etc. For this purpose, the Company shall maintain lists of individuals or entities issued by RBI, United Nations Security Council, other regulatory & enforcement agencies, internal lists as the Company may decide from time to time. Full details of accounts/ customers bearing resemblance with any of the individuals/ entities in the list shall be treated as suspicious and reported.
    i) Adequate due diligence is a fundamental requirement for establishing the identity of the customer. Identity generally means a set of attributes which together uniquely identify a natural person or legal entity. In order to avoid fictitious and fraudulent applications of the customers, and to achieve a reasonable degree of satisfaction as to the identity of the customer, the Company shall conduct appropriate due diligence. The nature and extent of basic due diligence measures to be conducted at the time of establishment of account opening/relationship, would depend upon the risk category of the customers and involve collection and recording of information by using reliable independent documents, data or any other information. This may include identification and verification of the applicant and wherever relevant, ascertaining of occupational details, legal status, ownership and control structure and any additional information in line with the assessment of the risks posed by the applicant and the applicant’s expected use of the Company’s products and services from an AML perspective.
    j) The Company may rely on third party verification subject to the conditions prescribed by the RBI, the PMLA and the Rules thereunder in this regard.
    k) For non-face-to-face customers, appropriate due diligence measures (including certification requirements of documents, if any) will be devised for identification and verification of such customers.
    l) Relationship/opening of accounts shall be established and the beneficiary of the relationship/account shall also be identified.
    m) The information collected from the customer shall be kept confidential.
    n) Appropriate Enhanced Due Diligence (EDD) measures shall be adopted for high risk customers from AML perspective, especially those for whom the sources of funds are not clear, transactions carried through correspondent accounts and customers who are Politically Exposed Persons (PEPs) and their family members/close relatives.
    o) In respect of unusual or suspicious transactions/applications or when the customer moves from a low risk to a high-risk profile, appropriate EDD measures shall be adopted.
    p) Where the Company is unable to apply appropriate KYC measures due to non-furnishing of information and /or non-cooperation by the customer, the Company may consider closing the account or terminating the business relationship. However, the decision to close an existing account shall be taken at a reasonably senior level, after giving due notice to the customer explaining the reasons for such a decision.The aspects mentioned in the CAP would be reckoned while evolving the KYC/AML procedures for various customers/products. However, while developing the KYC/CDD procedures, the Company shall ensure that its procedures do not become too restrictive or pose significant difficulties in availing its services by deserving general public, especially the financially and socially disadvantaged sections of society.
    5. RISK MANAGEMENT
    5.1
    For Risk Management, the Company will have a risk based approach which includes the following:

    a) Customers shall be categorized as low, medium and high risk category, based on the assessment and risk perception of the Company;
    b) Risk categorization shall be undertaken based on parameters such as customer’s identity, social/financial status, nature of business activity, and information about the clients’ business and their location etc. While considering customer’s identity, the ability to confirm identity documents through online or other services offered by issuing authorities may also be factored in.
    c) The customers will be monitored on regular basis with built in mechanism for tracking irregular behavior for risk management and suitable timely corrective action.
    5.2 High and Medium Risk from AML perspective
    A customer that is likely to pose a higher than average risk may be categorized high or medium risk depending on background, nature & location of customer, his/ her profile, scale of customer’s volume, his/ her financials and social status etc. Due diligence measures will be applied based on the risk assessment. The Company shall apply enhanced due diligence measures for higher risk customers, especially those for whom the sources of funds are not clear.

    a) Indicative list of High Risk Customers
    i) Individuals and entities in various United Nations' Security Council Resolutions (UNSCRs) such as UN 1267 etc.;
    ii) Individuals or entities listed in the schedule to the order under section 51A of the Unlawful Activities (Prevention) Act, 1967 relating to the purposes of prevention of, and for coping with terrorist activities;
    iii) Individuals and entities in watch lists issued by Interpol and other similar international organizations;
    iv) Customers with dubious reputation as per public information available or commercially available watch lists;
    v) Individuals and entities specifically identified by regulators, FIU and other competent authorities as high-risk;
    vi) Customers conducting their business relationship or transactions in unusual circumstances, such as significant and unexplained geographic distance between the institution and the location of the customer, frequent and unexplained movement of accounts to different institutions, etc.;
    vii) Politically exposed persons (PEPs), customers who are close relatives of PEPs and accounts of which a PEP is the ultimate beneficial owner;
    viii) Non-face-to-face customers;
    ix) High net worth individuals;
    x) Firms with 'sleeping partners';
    xi) Companies having close family shareholding or beneficial ownership;
    xii) Complex business ownership structures, which can make it easier to conceal underlying beneficiaries, where there is no legitimate commercial rationale;
    xiii) Shell companies which have no physical presence in branch locations. The existence simply of a local agent or low level staff does not constitute physical presence;
    xiv) Accounts for "gatekeepers" such as accountants, lawyers, or other professionals for their clients where the identity of the underlying client is not disclosed;
    xv) Client Accounts managed by professional service providers such as law firms, accountants, agents, brokers, fund managers, trustees, custodians etc.;
    xvi) Trusts, charities, NGOs/ unregulated clubs and organizations receiving donations;
    xvii) Gambling/gaming including “Junket Operators” arranging gambling tours;
    xviii) Jewelers and Bullion Dealers;
    xix) Dealers in high value or precious goods (e.g. gem and precious metals dealers, art and antique dealers and auction houses, estate agents and real estate brokers);
    xx) Customers engaged in a business which is associated with higher levels of corruption (e.g., arms manufacturers, dealers and intermediaries;
    xxi) Customers engaged in industries that might relate to nuclear proliferation activities or explosives;
    xxii) Customers that may appear to be Multi-level marketing companies etc.
    b) Indicative list of Medium Risk Customers

    i) Stock brokerage;
    ii) Import / Export;
    iii) Gas Station;
    iv) Car / Boat / Plane Dealership;
    v) Electronics (wholesale);
    vi) Travel agency;
    vii) Telemarketers;
    viii) Providers of telecommunications service, internet café, International direct dialing (IDD) call service.
    5.3 Low Risk from AML perspective
    All other customers (other than High and Medium Risk category) whose identities and sources of wealth can be easily identified and by and large conform to the known customer profile, may be categorized as low risk. In such cases, only the basic requirements of verifying the identity and location of the customer are to be met.

    Illustrative examples of low risk customers could be:
    i. Salaried applicants whose salary structures are well defined;
    ii. People belonging to government departments,
    iii. People working with govt. owned companies, regulators and statutory bodies etc;
    iv. People belonging to lower economic strata of the society whose accounts show small balances and low turnover;
    v. People working with Public Sector Units;
    vi. People working with reputed Public Limited companies & Multinational Companies.
    6. CUSTOMER IDENTIFICATION PROCEDURES (CIP)

    i) The Company shall undertake identification of customers in the following cases:
    i) Commencement of an account-based relationship with the customer;
    ii) When there is a doubt about the authenticity or adequacy of the customer identification data it has obtained;
    iii) Selling their own products, selling third party products as agents and any other product for more than Rs.50,000/-.
    iv) Carrying out transactions for a non-account based customer (walk-in customer);
    ii) The Company shall obtain satisfactory evidence of the identity of the customer depending upon the perceived risks at the time of commencement of relationship/ opening of account. Such evidences shall be substantiated by reliable independent documents, data or information or other means like physical verification etc.
    iii) The Company will obtain Permanent account number (PAN) of customers as per the applicable provisions of Income Tax Rule 114B. Form 60 shall be obtained from persons who do not have PAN.
    iv) For the customers that are legal person or entities:
    i) the Company will verify the legal status for the legal person/ entity through proper and relevant documents;
    ii) the Company will understand the beneficial ownership and control structure of the customer and determine who are the natural persons who ultimately control the legal person.
    v) Additional documentation may be obtained from the customers with higher risk perception as may be deemed fit. This shall be done having regard but not limited to location (registered office address, correspondence address and other addresses as may be applicable), nature of business activity, repayment mode & repayment track record.
    vi) An indicative list of the nature and type of documents/ information that may be relied upon for customer identification is provided in the ‘Annexure A’ of this Policy. The documents to be accepted by the Company for customer identification shall be based on the regulatory prescriptions from time to time and shall be finalized after approval from the Compliance Officer, Principal Officer & Head- Risk and Credit.
    vii) For the purpose of verifying the identity of customers at the time of commencement of an account-based relationship, the Company, at its discretion may at its option, rely on customer due diligence done by a third party, subject to the following conditions:
    i) Necessary information of such customers’ due diligence carried out by the third party is immediately obtained by the Company;
    ii) Adequate steps are taken by the Company to satisfy that copies of identification data and other relevant documentation relating to customer due diligence shall be made available from the third party upon request without delay
    iii) The third party is regulated, supervised or monitored for, and has measures in place for, compliance with customer due diligence and record-keeping requirements in line with the requirements and obligations under the PML Act;
    iv) The third party shall not be based in a country/ jurisdiction assessed as high risk;
    v) The ultimate responsibility for customer due diligence and undertaking enhanced due diligence measures, as applicable, will be with the Company.
    viii) While undertaking customer identification, the Company will ensure that:
    i) Decision-making functions of determining compliance with KYC norms shall not be outsourced.
    ii) The customers shall not be required to furnish an additional OVD, if the OVD submitted for KYC contains proof of identity as well as proof of address.
    iii) The customers will not be required to furnish separate proof of address for permanent and current addresses, if these are different. In case the proof of address furnished by the customer is the address where the customer is currently residing, a declaration shall be taken from the customer about her/ his local address on which all correspondence will be made by the Company. The local address for correspondence, for which their proof of address is not available, shall be verified through ‘positive confirmation’ such as cheque books, ATM cards, telephonic conversation, positive address verification, Rent agreement, etc.
    iv) In case of change in the address mentioned on the ‘proof of address’, fresh proof of address should be obtained within a period of six months.

    7. CUSTOMER DUE DILIGENCE (CDD) PROCEDURE
    7.1 CDD Procedure in case of Individuals

    a) The Company will obtain the following documents from an individual while establishing an account based relationship:
    i) one certified copy of an OVD as defined above containing details of identity and address;
    ii) one recent photograph; and
    iii) such other documents pertaining to the nature of business or financial status specified by the Company.

    The information collected from customers for the purpose of opening of account shall be treated as confidential and details thereof shall not be divulged for the purpose of cross selling, or for any other purpose without the express permission of the customer. Submission of PAN or form 60 in lieu of PAN and Aadhaar is mandatory for all customers, to the extent applicable, unless it is specifically exempted under any law/act/regulations/notification/circular etc.
    b) The e-KYC service of Unique Identification Authority of India (UIDAI) shall be accepted as a valid process for KYC verification and the information containing demographic details and photographs made available from UIDAI as a result of e-KYC process will be treated as an ‘Officially Valid Document’.

    However, before commencing the e-KYC process, there should be explicit consent and authorization from the individual customer authorizing UIDAI to release his/ her identity/address through biometric authentication to the Company or its Business Correspondents (BCs).

    Further,the Company may also opt for One Time Pin (OTP) based e-KYC process for on-boarding of customers subject to the following conditions:
    i) There must be a specific consent from the customer for authentication through OTP.
    ii) Only term loans not exceeding Rs.60,000/- in a year will be eligible.
    iii) Accounts opened using OTP based e-KYC shall not be allowed for more than one year within which Customer Due Diligence (CDD) procedure as provided in preceding paragraph is to be completed. If the CDD procedure is not completed within a year, no further debits shall be allowed in the loan account.
    iv) A declaration shall be obtained from the customer to the effect that no other account has been opened nor will be opened using OTP based KYC either with the Company or with any other Bank/ NBFC/ HFC/ other entities regulated by RBI/ NHB. Further, while uploading KYC information to CKYCR, the Company will clearly indicate that such accounts are opened using OTP based e-KYC and other regulated entities shall not open accounts based on the KYC information of accounts opened with OTP based e-KYC procedure.
    v) The Company will have monitoring procedures including systems to generate alerts in case of any non-compliance/violation, to ensure compliance with the above mentioned conditions.
    c) The Company may print/download directly, the prospective customer’s e-Aadhaar letter from the UIDAI portal, if such a customer knows only his/her Aadhaar number or if the customer carries only a copy of Aadhaar downloaded from a place/source elsewhere, provided, the prospective customer is physically present in the branch of the Company.
    d) A copy of the marriage certificate issued by the State Government or Gazette notification indicating change in name together with a certified copy of the ‘officially valid document’ in the existing name of the person shall be obtained for proof of address and identity, while establishing an account based relationship or while undertaking periodic updation exercise in cases of persons who change their names on account of marriage or otherwise.;
    e) If a person who proposes to open an account does not have an OVD as ‘proof of address’, such person shall provide OVD of the relative as provided at sub-section 77 of Section 2 of the Companies Act, 2013, read with Rule 4 of Companies (Specification of definitions details) Rules, 2014, with whom the person is staying, as the ‘proof of address’;
    Explanation: A declaration from the relative that the said person is a relative and is staying with him/her shall be obtained. Here relative means relative as per Companies Act, 2013.
    f) If a customer categorised as ‘low risk’ expresses inability to complete the documentation requirements on account of any genuine reason, and where it is essential not to interrupt the normal conduct of business, the Company may, at its discretion, complete the verification of identity of the customer within a period of 6 months from the date of establishment of the relationship.
    g) In respect of customers who are categorized as ‘low risk’ and are not able to produce any of the OVDs mentioned, ‘simplified procedure’ may be applied, Explanation: During the periodic review, if the ‘low risk’ category customer for whom simplified procedure is applied, is re-categorized as ‘moderate or ‘’high’ risk category, then the Company shall obtain one of the six standard OVDs listed at para 3.10 above for proof of identity and proof of address immediately.
    h) If an existing KYC compliant customer of the Company desires to open another account with it, there shall be no need for a fresh CDD exercise provided there is no change in details last provided under the Company’s KYC norms.
    i) KYC verification once done by one branch/office of the Company shall be valid for transfer of the account to any other branch/office of it, provided full KYC verification has already been done for the concerned account and the same is not due for periodic updation and a self-declaration from the account holder about his/her current address is obtained in such cases.
    j) Simplified procedure (based on the prescriptions by RBI for opening of accounts by an NBFC): In case a person who desires to open an account is not able to produce OVD/ valid KYC documents, the Company may at its discretion open accounts subject to the following conditions:

    i) Introduction from another account holder who has been subjected to full KYC procedure shall be obtained.
    ii) The introducer’s account with the Company shall be at least 6 months old and shows satisfactory transactions.
    iii) Photograph of the customer who proposes to open the account and also his address shall be certified by the introducer, or any other evidence as to the identity and address of the customer to the satisfaction of the Company shall be obtained.
    iv) The total credit in all the accounts taken together shall not exceed Rs.1,00,000/- in a year.
    v) The customer shall be made aware that no further transactions will be permitted until full KYC procedure is completed in case of breach of the above limit.
    vi) When the total credit in a year reaches Rs.80,000/-, the customer shall be notified that appropriate documents for conducting the KYC must be submitted otherwise the operations in the account shall be stopped when the total credits in all the accounts taken together exceed the limit of Rs.1,00,000/- in a year.
    7.2 CDD Measures for Sole Proprietary firms

    a) For opening an account in the name of a sole proprietary firm, a certified copy of an OVD as mentioned above, containing details of identity and address of the individual (proprietor) shall be obtained. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of partnership firm is mandatory.
    b) In addition to the above, any two of the following documents as a proof of business/ activity in the name of the proprietary firm shall also be obtained:
    i) Registration certificate;
    ii) Certificate/ License issued by the municipal authorities under Shop and Establishment Act;
    iii) Sales and income tax returns;
    iv) CST/VAT certificate;
    v) Certificate/registration document issued by Sales Tax/Service Tax/Professional Tax authorities;
    vi) License/certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute;
    vii) Complete Income Tax Return (not just the acknowledgement) in the name of the sole proprietor where the firm's income is reflected, duly authenticated/acknowledged by the Income Tax authorities;
    viii) Utility bills such as electricity, water, and landline telephone bills.

    In cases where the Company is satisfied that it is not possible to furnish two such documents, it may accept only one of those documents as proof of business/ activity, subject to contact point verification and collection of such other information and clarification as would be required to establish the existence of such firm. Further, it should be satisfied that the business activity has been verified from the address of the proprietary concern.
    7.3 CDD Measures for Legal Entities

    a) For opening an account of a company, one certified copy of each of the following documents shall be obtained:
    i) Certificate of incorporation.
    ii) Memorandum and Articles of Association.
    iii) A resolution from the Board of Directors and power of attorney granted to its managers, officers or employees to transact on its behalf.
    iv) Officially valid documents in respect of managers, officers or employees holding an attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of Company is mandatory.
    b) For opening an account of a partnership firm, one certified copy of each of the following documents shall be obtained:
    i) Registration certificate.
    ii) Partnership deed.
    iii) Officially valid documents in respect of the person holding an attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of partnership firm is mandatory.
    c) For opening an account of a trust, one certified copy of each of the following documents shall be obtained:
    i) Registration certificate.
    ii) Trust deed.
    iii) Officially valid documents in respect of the person holding a power of attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of trust is mandatory.
    d) For opening an account of an unincorporated association or a body of individuals, one certified copy of each of the following documents shall be obtained:
    i) Resolution of the managing body of such association or body of individuals;
    ii) Power of attorney granted to transact on its behalf;
    iii) Officially valid documents in respect of the person holding an attorney to transact on its behalf. PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on its behalf is mandatory, and
    iv) Such information as may be required by the Company to collectively establish the legal existence of such an association or body of individuals.
    Explanation: Unregistered trusts/partnership firms shall be included under the term ‘unincorporated association’.
    Explanation: Term ‘body of individuals’ includes societies.
    e) For opening accounts of juridical persons not specifically covered in the earlier part, such as Government or its Departments, societies, universities and local bodies like village panchayats, one certified copy of the following documents shall be obtained:
    i) Document showing name of the person authorised to act on behalf of the entity;
    ii) Officially valid documents for proof of identity and address in respect of the person holding an attorney to transact on its behalf; and
    iii) Such documents as may be required by the RE to establish the legal existence of such an entity/ juridical person.
    iv) PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney to transact the business on behalf of partnership firm is mandatory.
    7.4 Selling Third party products-
    The Company, if acting as agents while selling third party products as per regulations in force from time to time, will comply with the following aspects:

    a) The identity and address of the walk-in customer shall be verified for transactions above Rs.50,000/-fifty thousand as required under its CIP;
    b) Transaction details of sale of third party products and related records shall be maintained.
    c) Monitoring of transactions for any suspicious activity will be done.
    7.5 Enhanced Due Diligence

    a) Accounts of non-face-to-face customers: The Company will include additional procedures i.e., certification of all the documents presented, calling for additional documents and the first payment to be effected through the customer's KYC-complied account with another regulated entity for enhanced due diligence of non-face to face customers.
    b) Accounts of Politically Exposed Persons (PEPs): The Company will have the option of establishing a relationship with PEPs, provided that:
    i) sufficient information including information about the sources of funds accounts of family members and close relatives is gathered on the PEP;
    ii) the identity of the person shall have been verified before accepting the PEP as a customer;
    iii) the decision to open an account for a PEP is taken at a senior level in accordance with the Company’s Customer Acceptance Policy;
    iv) all such accounts are subjected to enhanced monitoring on an on-going basis;
    v) in the event of an existing customer or the beneficial owner of an existing account subsequently becoming a PEP, senior management’s approval is obtained to continue the business relationship;
    vi) the CDD measures as applicable to PEPs including enhanced monitoring on an on-going basis are applicable.

    The above will also be applicable to accounts where a PEP is the beneficial owner.

    For all the customers for which enhanced due diligence “EDD” is required, the Company will conduct the same in line with EDD policy of the group. Any deviation to group EDD policy will be entertained as an exception and will require approval of Principal Officer. Group Policy is enclosed as Annexure-B.
    7.6 Simplified Due Diligence

    a) For Self Help Groups (SHGs)
    i) KYC verification of all the members of SHG shall not be required while opening the savings bank account of the SHG.
    ii) KYC verification of all the office bearers shall suffice.
    iii) No separate KYC verification of the members or office bearers shall be necessary at the time of credit linking of SHGs
    7.7 Identification of Beneficial Owner
    For opening an account of a Legal Person who is not a natural person, the beneficial owner(s) shall be identified and all reasonable steps to verify his/her identity shall be undertaken keeping in view the following:
    a) Where the customer or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies.
    b) In cases of trust/ nominee or fiduciary accounts whether the customer is acting on behalf of another person as trustee/ nominee or any other intermediary is determined. In such cases, satisfactory evidence of the identity of the intermediaries and of the persons on whose behalf they are acting, as also details of the nature of the trust or other arrangements in place shall be obtained.
    8. MONITORING OF TRANSACTIONS/ ON-GOING DUE DILIGENCE
    Ongoing monitoring is an essential element of effective KYC procedures. The Company shall on-going due diligence of customers to ensure that their transactions are consistent with their knowledge about the customers, customers’ business and risk profile; and the source of funds.

    The Company shall identify transactions that fall outside the regular pattern of activity. However, the extent of monitoring will depend on the risk sensitivity of the account. The Company shall pay special attention to all complex, unusually large transactions and all unusual patterns which have no apparent economic or visible lawful purpose.
    8.1
    The Company will put in place a system of periodical review of risk categorization of accounts and the need for applying enhanced due diligence measures in case of higher risk perception on a customer. The Company will carry such review of risk categorization of customers at a periodicity of not less than once in six months.
    8.2 Periodic Updation-
    The Company will conduct periodic updation of KYC documents at least once in every two years for high risk customers, once in every eight years for medium risk customers and once in every ten years for low risk customers subject to the following conditions:
    a) Fresh proofs of identity and address shall not be sought at the time of periodic updation from customers who are categorised as ‘low risk’, when there is no change in status with respect to their identities and addresses and a self-certification to that effect is obtained.
    b) A certified copy of the proof of address forwarded by ‘low risk’ customers through mail/ post, etc., in case of change of address shall be acceptable.
    c) Physical presence of low risk customer at the time of periodic updation shall not be insisted upon.
    d) The time limits prescribed above would apply from the date of opening of the account/ last verification of KYC.
    e) Fresh photographs shall be obtained from customer for whom account was opened when they were minor, on their becoming a major.
    f) E-KYC process using OTP based authentication for periodic updation is allowed provided while on boarding, the customer was subjected to proper KYC process.
    9. REPORTING TO FINANCIAL INTELLIGENCE UNIT- INDIA
    9.1
    In accordance with the requirements under PMLA, the Company will furnish the following reports, as and when required, to the Director, Financial Intelligence Unit-India (FIU-IND):
    a) Cash Transaction Report (CTR)- If any such transactions detected, Cash Transaction Report (CTR) for each month by 15th of the succeeding month.
    b) Counterfeit Currency Report (CCR)- All such cash transactions where forged or counterfeit Indian currency notes have been used as genuine as Counterfeit Currency Report (CCR) for each month by 15th of the succeeding month.
    c) Suspicious Transactions Reporting (STR)- The Company will endeavor to put in place automated systems for monitoring transactions to identify potentially suspicious activity. Such triggers will be investigated and any suspicious activity will be reported to FIU-IND.

    The Company will file the Suspicious Transaction Report (STR) to FIU-IND within 7 days of arriving at a conclusion that any transaction, whether cash or non-cash, or a series of transactions integrally connected are of suspicious nature. However, in accordance with the regulatory requirements, the Company will not put any restriction on operations in the accounts where an STR has been filed. An indicative list of suspicious transactions is enclosed as Annexure-C.
    9.2 Confidentiality and Prohibition against disclosing Suspicious Activity Investigations and Reports-
    The Company will maintain utmost confidentiality in investigating suspicious activities and while reporting CTR/ CCR/ STR to the FIU-IND/ higher authorities. However, the Company may share the information pertaining to the customers with the statutory/ regulatory bodies and other organizations such as banks, credit bureaus, income tax authorities, local government authorities etc.
    10. SHARING KYC INFORMATION WITH CENTRAL KYC RECORDS REGISTRY (CKYCR)
    The Company will capture the KYC information for sharing with the CKYCR in the manner as prescribed in the Prevention of Money Laundering (Maintenance of Records) Rules, 2005, under the prescribed KYC templates for ‘individuals’ and ‘Legal Entities’ as applicable. Further, the Company will upload the KYC data pertaining to all types of prescribed accounts with CKYCR, as and when required, in terms of the provisions of the Prevention of Money Laundering (Maintenance of Records) Rules, 2005.
    11. REPORTING REQUIREMENT UNDER FOREIGN ACCOUNT TAX COMPLIANCE ACT (FATCA) AND COMMON REPORTING STANDARDS (CRS)
    If applicable to the Company, it will adhere to the provisions of Income Tax Rules 114F, 114G and 114H. If the Company becomes a Reporting Financial Institution as defined in Income Tax Rule 114F, it will take the following requisite steps for complying with the reporting requirements:

    d) Register on the related e-filling portal of Income Tax Department as a Reporting Financial Institution;
    e) Submit online reports by using the digital signature of the ‘Designated Director’ by either uploading the Form 61B or ‘NIL’ report, for which, the schema prepared by Central Board of Direct Taxes (CBDT) shall be referred to;
    f) Develop Information Technology (IT) framework for carrying out due diligence procedure and for recording and maintaining the same, as provided in Rule 114H;
    g) Develop a system of audit for the IT framework and compliance with Rules 114F, 114G and 114H of Income Tax Rules.;
    h) Constitute a “High Level Monitoring Committee” under the Designated Director or any other equivalent functionary to ensure compliance;
    i) Ensure compliance with updated instructions/ rules/ guidance notes/ Press releases/ issued on the subject by Central Board of Direct Taxes (CBDT) from time to time.

    12. INDEPENDENT EVALUTION
    To provide reasonable assurance that its KYC and AML procedures are functioning effectively, an audit of its KYC and AML processes will covered under Internal Audit of the Company.
    The audit findings and compliance thereof will be put up before the Audit Committee of the Board on quarterly intervals till closure of audit findings.
    13. RESPONSIBILITIES OF THE SENIOR MANAGEMENT
    13.1 Designated Director-
    The Company shall nominate a “Designated Director” to ensure compliance with the obligations prescribed by the PMLA and the Rules thereunder. The “Designated Director” can be a person who holds the position of senior management or equivalent. However, it shall be ensured that the Principal Officer is not nominated as the “Designated Director”.
    13.2 Principal Officer-
    An official (having knowledge, sufficient independence, authority, time and resources to manage and mitigate the AML risks of the business) shall be designated as the Principal Officer of the Company. The Principal Officer will responsible for ensuring compliance, monitoring transactions, and sharing and reporting information as required under the law/ regulations.
    13.3 Key Responsibilities of the senior management

    i) Ensuring overall compliance with regulatory guidelines on KYC/ AML issued from time to time and obligations under PMLA.
    ii) Proper implementation of the company’s KYC & AML policy and procedures.
    14. RECORD MANAGEMENT
    14.1 Record-keeping requirements-
    The Company shall introduce a system of maintaining proper record of transactions required under PMLA as mentioned below:
    a) all cash transactions of the value of more than Rs.10 lakh or its equivalent in foreign currency;
    b) all series of cash transactions integrally connected to each other which have been individually valued below Rs.10 lakh or its equivalent in foreign currency where such series of transactions have taken place within a month and the monthly aggregate exceeds Rs.10 lakh or its equivalent in foreign
    c) all cash transactions where forged or counterfeit currency notes or bank notes have been used as genuine and where any forgery of a valuable security or a document has taken place facilitating the transactions;
    d) all suspicious transactions whether or not made in cash; and
    e) records pertaining to identification of the customer and his/her address; and
    f) should allow data to be retrieved easily and quickly whenever required or when requested by the competent authorities.
    14.2 Records to contain the specified information-
    The records should contain the following information:
    a) the nature of the transactions;
    b) the amount of the transaction and the currency in which it was denominated;
    c) the date on which the transaction was conducted; and
    d) the parties to the transaction.
    14.3 Maintenance and Preservation of records

    a) maintain for at least 5 years from the date of transaction between the Company and the client, all necessary records of transactions referred in para 13.1 above;
    b) maintain for at least 5 years from the date of transaction between the Company and the client, all necessary records of transactions which will permit reconstruction of individual transactions so as to provide, if necessary, evidence for prosecution of persons involved in criminal activity;
    c) records pertaining to the identification of the customer and his address (e.g. copies of documents like passports, identity cards, driving licenses, PAN card etc.) obtained while opening the account and during the course of business relationship would continue to be preserved for at least 5 years after the business relationship is ended;
    d) records may be maintained either in hard or soft format.
    15. HIRING OF EMPLOYEES, THEIR TRAINING AND EDUCATION OF CUSTOMERS
    15.1 Hiring of Employees and Employee training-
    Adequate screening mechanism as an integral part of their personnel recruitment/hiring process shall be put in place. On-going employee training programme will be put in place so that the members of staff are adequately trained in KYC & AML policy.
    15.2
    Implementation of KYC Procedures requires the Company to seek information which may be of personal nature or which has hitherto never been called for. This can sometimes lead to a lot of questioning by the customer as to the motive and purpose of collecting such information. To meet such situation, it is necessary that the customers are educated and apprised about the sanctity and objectives of KYC procedures so that the customers do not feel hesitant or have any reservation while passing on the information to the Company. To educate the customers, the Company will arrange FAQs on KYC and AML measures. Such FAQs may be made available to the customers directly, on request, or through the Company’s website.
    16. Procedure for freezing of funds, financial assets or economic resources or related services

    i. By virtue of Section 51A of UAPA, the Central Government is empowered to freeze, seize or attach funds of and/or prevent entry into or transit through India any individual or entities that are suspected to be engaged in terrorism.
    ii. Reporting entities shall follow the procedure prescribed by respective regulators for freezing of accounts of designated individuals/entities in case any customer records are matched with that of designated individuals/ entities.
    iii. Reporting entities shall comply with the procedure prescribed by respective regulators for unfreezing of accounts of ‘designated individuals/entities’ in case of individuals/entities inadvertently affected by the freezing mechanism, upon verification that the individual/ entity is not a designated individual/entity.
    iv. Reporting entities shall comply with the procedure prescribed by respective regulator for implementation of requests received for freezing of insurance policies of ‘designated individuals/entities’ without prior notice to the designated persons involved.
    Annexure A

    Indicative List of Customer Identification Documents

    Features Documents
    Individuals Proof of Identity

    Proof of Address

    Copy of any one of the following:

    i) Passport (Not Expired)
    ii) PAN Card or Form 60 as applicable as per the policy-Mandatory
    iii) Voter’s Identity Card issued by Election Commission
    iv) Driving License (Not Expired)
    v) Job Card issued by NREGA duly signed by an officer of the State Govt.
    vi) The letter issued by the Unique Identification Authority of India (UIDAI) containing details of name, address and Aadhaar number or Aadhar Card-Mandatory
    vii) Details from obtained through e-KYC service of Unique Identification Authority of India (UIDAI).

    Where ‘simplified measures’ are applied for verifying the identity of customers the following documents shall be deemed to be 'officially valid documents:
    i) identity card with applicant's Photograph issued by Central/State Government Departments, Statutory/Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions;
    ii) letter issued by a gazetted officer, with a duly attested photograph of the person.

    Where ‘simplified measures’ are applied for verifying for the limited purpose of proof of address the following additional documents are deemed to be OVDs
    i) Utility bill which is not more than two months old of any service provider (electricity, telephone, post-paid mobile phone, piped gas, water bill);
    ii) Property or Municipal Tax receipt;
    iii) Bank account or Post Office savings bank account statement;
    iv) Pension or family pension payment orders (PPOs) issued to retired employees by Government Departments or Public Sector Undertakings, if they contain the address;
    v) Letter of allotment of accommodation from employer issued by State or Central Government departments, statutory or regulatory bodies, public sector undertakings, scheduled commercial banks, financial institutions and listed companies. Similarly, leave and license agreements with such employers allotting official accommodation; and
    vi) Documents issued by Government departments of foreign jurisdictions and letter issued by Foreign Embassy or Mission in India When address in Aadhaar is different from current address, the Company will obtain an additional OVD or document as specified under simplified measures.
    Accounts of Companies i) Certificate of incorporation;
    ii) Memorandum and Articles of Association;
    iii) A resolution from the Board of Directors and power of attorney granted to managers, officers or employees to transact on its behalf; and
    iv) An officially valid document in respect of managers, officers or employees holding an attorney to transact on its behalf.

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on behalf of Company is mandatory. PAN and Aadhaar for UBO is also required to be obtained.
    Accounts of Partnership firms i) Registration certificate;
    ii) Partnership deed; and
    iii) An officially valid document in respect of the person holding an attorney to transact on its behalf.

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on behalf of Firm is mandatory.
    Accounts of Trusts and foundations i) Registration certificate;
    ii) Trust deed; and
    iii) An officially valid document in respect of the person holding a power of attorney to transact on its behalf

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on behalf of trust is mandatory.
    Accounts of unincorporated association or a body of individuals i) Resolution of the managing body of such association or body of individuals;
    ii) Power of attorney granted to him to transact on its behalf;
    iii) An officially valid document in respect of the person holding an attorney to transact on its behalf; and
    iv) Such information as may be required by the bank to collectively establish the legal existence of such an association or body of individuals.

    Note: PAN or form 60 in lieu of PAN and Aadhaar of the persons holding an attorney/authorisation to transact the business on its behalf is mandatory.
    Accounts of Proprietorship Concerns
    Proof of the name, address and activity of the concern
    Apart from Customer identification procedure as applicable to the proprietor any two of the following documents in the name of the proprietary concern would suffice:
  • Registration certificate (in the case of a registered concern)
  • Certificate/licence issued by the Municipal authorities under Shop & Establishment Act,
  • Sales and income tax returns
  • CST/VAT certificate
  • Certificate/registration document issued by GST/Sales Tax/Service Tax/Professional Tax authorities
  • IEC (Import Export Code) issued to proprietary concern by the office of DGFT.
  • Licence/certificate of practice issued in the name of the proprietary concern by any professional body incorporated under a statute.
  • The complete Income Tax return (not just the acknowledgement) in the name of the sole proprietor where the firm's income is reflected, duly authenticated/ acknowledged by the Income Tax Authorities.
  • Utility bills such as electricity, water and landline telephone bills However, in cases where the Company is satisfied that, for any proposal, the proprietary concern is not possible to furnish two such documents, the Company will have the discretion to accept only one of those documents as activity proof. In such cases, the Company, however, will undertake contact point verification, collect such information as would be required to establish the existence of such firm, confirm, clarify and satisfy themselves that the business activity has been verified from the address of the proprietary concern.
  • Annexure-B

    Enhanced Due Diligence Policy

    Introduction:
    The cornerstone of a strong Anti Money Laundering program is the adoption and implementation of comprehensive customer due diligence policies, procedures, and processes for all customers, particularly those that present a higher risk for money laundering and terrorist financing. As a result, due diligence procedures and processes should be enhanced for such high risk customers. Enhanced Due Diligence (EDD) for High Risk Customers including Politically Exposed Persons (PEPs) and Clients of Special Category (CSC) is especially critical in understanding their transactions and implementing a monitoring system that reduces the Group’s regulatory and reputational risks. High risk customers and their transactions should be reviewed more closely at account opening and more frequently throughout the term of their relationship. Regulators like SEBI, IRDAI, RBI, etc. have also continuously emphasised on the need to carry out enhanced due diligence for such high risk customers. High Risk customer/CSC: A High Risk customer/CSC would typically be persons/entities that by nature of their occupation, place of residence or any other characteristic, are more vulnerable to money laundering. Below is the list for classifying a customer as high risk customer/CSC:
  • Non Resident clients
  • High Net-worth Individuals (each entity to define threshold for HNI)
  • Trusts, Charities, NGOs and organizations receiving donations
  • Politically Exposed Persons (PEP) as defined in the AML Policy
  • Companies undertaking Forex Business
  • Clients in high risk countries where existence / effective money laundering controls is suspect, where there is unusual banking secrecy, countries active in narcotics production, countries where corruption (as per Transparency International Corruption Perception Index) is highly prevalent, countries against which government sanctions are applied, countries reputed to be any of the following - havens/ sponsors of international terrorism, offshore financial centers, tax havens, countries where fraud is highly prevalent.
    {Note: click the following link for list of high risk countries as published by FATF - http://www.fatf-gafi.org/countries/#high-risk }
  • Non face to face clients, if any
  • Clients with dubious reputation as per public information available etc.

  • Apart from above, when establishing business relationship with a customer, the entity should further classify the customer as High Risk/CSC customer by assessing the following risk categories:
  • risk associated with the legal form of the customer (eg. companies having close family shareholding, partnership firm with sleeping partners, etc.);
  • risk associated with the economic or personal activity of the customer (eg. person/entity carrying out cash incentive business like restaurant business, dealing in arms, etc.);
  • risk associated with the products or services used by the customer (eg. single premium insurance policy where the money is invested in lump sum and surrendered at the earliest opportunity, etc.)
  • Businesses shall exercise independent judgment to ascertain whether any other set of clients shall be classified as High Risk customer/CSC or not. Apart from conducting the basic KYC as per the requirement of the respective business, the entity shall perform EDD for customers who are classified as High Risk Customer / CSC.

    Enhanced Due Diligence (EDD):

    EDD shall comprise the following:
    1. EDD needs to be undertaken at inception of business relationship with a customer.
  • Laying down reasonable measures to understand whether customer’s source of income and net worth is commensurate with the assessed risk of the customer profile. In this regard, any one of the documents as mentioned in Annexure A can be obtained. This is an illustrative list and entities may obtain any additional documents for verifying source of income and net worth in consultation with GCG team.
  • Basis the above document, Relationship Manager (RM)/Customer facing team to provide report on customer profile. Report to contain customer details like occupation, net worth, income details, beneficial ownership details (in case of non individual accounts), etc.


  • Post conducting above due diligence and completion of KYC requirement, approval of senior official shall be taken for on-boarding high risk customer/CSC. Operations team in consultation with relationship manager to provide customer details to the senior official in Annexure B, seeking their approval to on-board the customer.

    Each business shall define the approval hierarchy for such High Risk customer/CSC jointly with GCG.

    For PEP cases, approval of CCG Head shall additionally be taken. Post obtaining approval for High Risk customer/CSC, customer can be on-boarded, subject to any other business specific requirement.

    2. EDD to be performed during business relationship by taking below steps:
  • More frequent review of the customer’s profile/transactions, which shall be more stringent for High risk customer/CSC. In this regard, each business unit to formulate its own parameters considering the regulatory requirement jointly with GCG.
  • Updation of KYC shall be done at higher frequency for High risk customer/CSC accounts as specified by the regulator.

    Above EDD process is not intended to be exhaustive, businesses may adopt a more stringent EDD process as per their requirements and regulatory guidelines.

    Change in Customer categorisation:
  • Where there is change in customer categorisation to high risk/CSC basis review of customer’s transaction and profile, EDD process as mentioned above shall be carried out.
  • Further approval of senior official as per the hierarchy mentioned above shall be taken to continue relationship with such customer.
  • In case of PEP, approval of CCG Head shall additionally be obtained to continue business relationship with such PEP.

  • Annexure A

    Illustrative list of Income Proofs

    Income proofs for Individuals:

    1. Latest copy of Income tax assessment orders/ Income Tax returns slips
    2. Form 16 in case of employed individual
    3. Latest Salary slip from employer
    4. Bank statement showing income credit like salary Income, rent income, etc.
    5. Mandi receipt for Agricultural Income
    6. CA certificate on client’s Income/Net Worth
    7. Registered Rent Agreement

    Income Proofs for Non-Individuals:

    1. Latest copy of Income tax assessment orders/ Income Tax returns slips
    2. Latest copy of Audited Statements
    3. Annual Report
    4. Chartered Accountant's certificate on client’s Income/Net Worth

    Annexure B
    Basic Client Information
    SBU
    LOB
    Sub-Lob
    EW Legal Entity
    Customer First Name
    Customer Last Name
    Type of High Risk Customer/ CSC (eg. HNI, NRI, PEP, etc.)
    Why classified as High Risk Customer/CSC/PEP
    Date of Birth
    Place of Birth
    Address:
    National ID/PAN No.
    Other ID
    Passport #
    Action initiated by any enforcement agency
    Are there any sanctions Imposed
    Criminal History if any
    Any adverse news
    Any Additional Information
    Enhance Due Diligence Details
    Customer’s Income (as per Income proofs submitted)
    Whether source of income/asset ownership document submitted like ITR, Salary Slip, Form 16, Audited financial statement, etc. (Yes/No)
    Source of Income document submitted by customer independently verified (Yes/No)
    Relationship manager report submitted (Yes/No)
    Basis of recommendation:
    Annexure C

    Indicative list of suspicious transactions are as below:

  • Customer did not open account after being informed about KYC requirements
  • Submission of false Identification Documents.
  • Customer holding multiple PAN.
  • Customer uses aliases and a variety of similar but different addresses.
  • Name of customer indicated differently in different KYC documents enabling creation of multiple customer identities.
  • The customer is reluctant to meet in person, represents through a third party/Power of Attorney holder without sufficient reasons.
  • Address provided by the customer is found to be non- existent.
  • Changes in mailing address of the Customer more than twice in last 6 months
  • The customer details matched with watch lists (e.g. UN list, Interpol list etc.)
  • Customer shows income from “foreign sources” on loan application without providing proper documentation.
  • Multiple addresses reflecting against the name of the customer which has not been shared / or does not match with the employment history / residence details provided.
  • Customer appears to have recently established a series of new relationships with different financial entities.
  • Encashment of loan amount by opening a fictitious bank account.
  • Suggesting dubious means for the sanction of loan
  • Cash payment shown as consideration paid to the seller for purchase of a property and the source of which cannot be explained or proof not provided by the customer.
  • Customer buys back a property that he or she recently sold without justification
  • Usage of loan amount by the customer in connivance with the vendor/builder/developer/broker/agent etc. and using the same for a purpose other than what has been stipulated.
  • Valuation of property shown considerably lower in the sale deed than the government approved rate / RESIDEX, especially on sale deeds executed within a period of 12 months.
  • Specifically in cases where the source is specified as "Funds from Family" and the customer fails or refuses to divulge any information or proof on where the concerned family member is providing the funds from.
  • Customer buys back a property that he or she recently sold without justification
  • Builder approaching the HFC for a small loan compared to the total cost of the project
  • Builder is unable to explain the sources of funding for the project
  • Approvals/sanctions from various authorities are proved to be fake
  • Customer offers different identifications on different occasions with
  • an apparent attempt to avoid linkage of multiple transactions.
  • Such other items specified in the list issued by NHB/RBI/FIU and other regulators
  • Major Terms and Conditions of the_________________________ loan agreed to between:
    Applicant  
    Co-applicant  
    Co-applicant  
    (Hereinafter individually and /or collectively referred as the “Borrower/s”)
    And  
    Edelweiss Housing Finance Limited (EHFL)  
    Please find below a brief of the important terms and conditions pertaining to the above loan account:

    I. Loan Details:-

    Loan Amount  
    Purpose of Loan (Scheme) Construction / Purchase / Extension / Renovation / Improvement / Mortgage / Plot /Composite / Commercial /Any other, please specify___________________
    Type(Fixed or Floating or Dual/Special Rate or Semi- fixed):): _______________ p. a [Fixed / Variable/Semi-fixed – Annually/ Monthly]
    Interest Chargeable ____ %p. a (_____% Reference rate -_____% margin) for floating rate loans; and/or _______________% for fixed rate loans)
    Tenure __________yrs
    Installment Type Monthly
    Moratorium or subsidy  
    Date of reset of interest  
    Modes of communication of changes in interest rate(Tick the relevant mode) Any change in interest rate would be duly communicated to the borrower at the contact details available with EHFL through SMS/ E-mail/ Courier or any other electronic mode prevalent for the time being.

    II. Fee and Other Charges:

    On application
  • Processing fees:
  • CERSAI fee:
  • Fees refundable if loan not sanctioned/disbursed Processing Fee paid by customer for availing the loan is non-refundable.

    The details of other applicable fee and other charges are mentioned in the Fees & Charges enclosed as Annexure to MITC documents and also updated on our website www.edelweisshousingfin.com/FeesCharges

    Taxes, duties, levies and Cess etc. under the applicable laws as may be amended from time to time, would be charged over and above the abovementioned fees and/or charges. The charges are as on date and subject to change from time to time. The Company shall update the revised version on its website from time to time.

    Detailed terms and conditions on the Fees, Charges, Cost and Claims are mentioned in the Loan Agreement.

    III. Security for the Loan

    Property address
    Name of Guarantor
    Other security
    Security of the loan would generally be security interest on the property being financed and / or any other additional security in the nature of additional property/ Guarantors as may be mandated by EHFL. Borrower/s is/are advised to refer the Loan Agreement and Sanction Letter to know the security details of the Loan sanctioned

    IV. Insurance of the property / Borrowers

    The Borrower shall insure and keep insured the Property against fire and other customary risks and hazards, for a value as may be required by the EHFL, with an insurance company acceptable to EHFL. EHFL shall be made the sole beneficiary under the insurance policy.

    Property insurance : ___________________________________________
    Borrowers Insurance: ___________________________________________

    V. Conditions for Disbursement of the Loan

    EHFL shall not disburse the loan or any installment thereof to the Borrower unless the conditions mentioned in the Housing Loan sanction letter and Loan Agreement are complied with, to the satisfaction and sole discretion of EHFL. A few of which are as given below:
  • The Borrower must fulfill the EHFL’s requirement of creditworthiness.
  • Submit all relevant documents as mentioned in the Sanction Letter/Loan Agreement
  • Execution of loan agreement and such other ancillary documents.
  • Submission of post dated cheques/ECS etc. towards repayment of installments.
  • Creation of security in favour of EHFL.
  • The Borrower must ensure that he has absolute, clear and marketable title to the property (security) and the said property is absolutely unencumbered and free from any liability whatsoever.
  • Intimate EHFL of any change in his employment / contact details.
  • Utilisation of disbursement should be towards acquisition/construction of property or as per the end use specified. In the construction cases, disbursement shall be linked to stage of construction
  • Pre-EMI Interest will be charged till the full sanction amount is not disbursed
  • No event of default shall have happened on the Loan. The Event of Defaults are mentioned in the Loan Agreement.
  • No circumstances shall have occurred, which in the opinion of EHFL may make it impossible for the Borrower to fulfill the obligations as per Loan Agreement and other standard documents executed by the Borrower for availing the loan.
  • NOC/Permission/approvals to mortgage etc and creation of security
  • VI. Repayment of the Loan and Interest

    The information on interest rate, Pre Equated Monthly Installment Interest (PEMII)/Equated monthly installment (EMI) and number of installment, tenure of loan are mentioned in the Sanction Letter provided to the Borrower. Any change in adjustable rate of interest /PEMII/EMI shall be informed to the borrower as per the EHFL’s Fair Practice Code at the contact details available with the EHFL. The Loan is required to be repaid in the prescribed EMI/PEMII on the due date as mentioned in the Loan Agreement.
    The repayment of EMI/PEMII is mandated through ECS/post dated cheques in favor of EHFL.
    The Borrower must ensure:
  • That sufficient fund is available in the designated Bank account of Borrower to be debited.
  • Not to cancel/put stop payment on the cheques/instruments given towards the repayment of EMI. Also, not to close or change the account upon which repayment instrument is drawn (unless he/she makes alternate arrangement for the repayment as agreeable to EHFL).
  • To pay the installment on or before the relevant due date, if not, the outstanding loan amount and all accrued interest would become immediately due and payable. The Borrower would also be liable to pay the fees as set out in the Statement of Charges.
  • Detailed terms and conditions of repayment of loan are mentioned in of the Loan Agreement.
  • VII. Brief procedure to be followed for Recovery of Overdues

    In the event of default (i.e. if the amount outstanding in the loan account of the Borrower is not paid by the due date or in case of breach of any clause of the agreement), the Borrower would be sent reminder from time to time for payment of any outstanding on his loan account, by post, fax, telephone, e-mail, SMS and/or through third parties appointed for collection purposes to remind, followup and collect dues.
    The Collection methodology includes the following:
  • Tele- Calling and Pick up : It involves contacting the Borrower over the phone and making them aware about the missed due date and requesting to pay the arrears at the earliest.
  • Field Collection: It involves meeting the Borrower and collecting the payment of the amount due. The activity shall be carried out through employees of EHFL or authorized representatives. The payment would be collected either in cash or in the form of a cheque/DD and receipt will be issued to Borrower.
  • Legal action shall be taken based on circumstances of each delinquent account, as per the policy of EHFL and pursuant to the provision of applicable laws.
  • Hence, EHFL shall use a judicious mix of field visit, written communication and legal action to ensure proper and effective coverage for the different category of delinquent account.

    VIII. Date on which annual outstanding balance statement will be issued: On Customer's request.

    IX. Customer Services

  • Visiting hours –Branches: 10AM – 5 PM, Mon-Fri (Except Public Holidays)
  • For any service related issue including request for documents, Borrower can get in touch with the EHFL by:
  • (i) Email at homeservice@edelweissfin.com
    (ii) Contacting the customer service executive at any of the branches
    (iii) Online by logon to www.edelweisshousingfin.com
  • Timelines for providing the following documents:
  • (i) Loan Account statement – 2 Days
    (ii) Photocopy of the title document – 12 Days
    (iii) Return of original documents on closure /transfer of the loan-15 Days

    IX. Grievance Redressal

    In case of any complaint/grievance, the Borrower may contact our Corporate Office through any of the following channels:
    Mr. Nileshkumar Jain
    Email: homeservice@edelweissfin.com
    Mail: Edelweiss Housing Finance Ltd, Edelweiss House, Off. C.S.T Road, Kalina, Mumbai - 400 098; Telephone: 022 – 4272 2272

    After examining the matter, it would be EHFL’s endeavor to provide the Borrower with our response, within a period of six (6) weeks from the receipt of such complaint/grievance.

    If the customer does not receive response from the Company or is dissatisfied with the response received, the complainant may approach the Complaint Redressal Cell of National Housing Bank by lodging his complaint in Online mode at the link http://grids.nhbonline.org.in or in Offline mode by post in prescribed format available at link http://www.nhb.org.in/Grievance-Redressal-System/Lodging-Complaint-Against-HFCs-NHB%E2%80%93Physical-Mode.pdf ,to the following address:
    Complaint Redressal Cell, Department of Regulation and Supervision, National Housing Bank, 4th Floor, Core-5A, India Habitat Centre, Lodhi Road, New Delhi – 110 003

    It is hereby agreed that for detailed terms and conditions of the Loan, the parties hereto shall refer to and rely upon the Loan Agreement and other security documents executed / to be executed by them.

    I/We the borrowers hereby confirm and declare that the above terms and conditions have been read by me/us / read over to me/ us in my/our vernacular language by Mr./Ms._______________________________ of the Company. I/We have understood the term and conditions as mentioned above and agree, confirm and declare to abide by the same. I/We also acknowledge the receipt of a copy of Most Important Terms & Conditions.

    Borrower(s) Name




    Edelweiss Housing Finance Limited
    Signature(s)




    Authorised Signatory

    Policy for determining Interest Rates and Processing and other charges

    As stipulated by the Reserve Bank of India (RBI), the Board of Directors of Edelweiss Retail Finance Limited (ERFL) in their meeting held on February 25, 2015 laid down the policy for determining Interest Rates, Processing and other charges for the Loan against Property (LAP) product. The said policy has been framed in the light of RBI circular Ref. No. RBI/2008-09/337/DNBS(PD)/CC. No. 133/03.10.001/2008-09 dated January 2, 2009 and is as under:

    Interest Rate
    The interest rates charged by ERFL shall be linked with the ERFL Mortgage Reference Rate (ERFLMRR). ERFLMRR shall be determined by the Risk & Asset Liability Management Committee of the ERFL on the basis of the cost of borrowing of ERFL, operating cost, liquidity and interest rate trend in the market and return on equity.

    The Risk & Asset Liability Management Committee of the Board of Directors of ERFL shall review ERFLMRR on such periodicity as may be deemed necessary by the Risk & Asset Liability Management Committee of the Board of Directors of ERFL and modify the same depending upon the market trends. The Risk & Asset Liability Management Committee of the Board of Directors of ERFL will adopt the basic formula as provided below for determining ERFLMRR with such modification as may be deemed necessary by the Risk & Asset Liability Management Committee of the Board of Directors of ERFL.

    The interest rate shall be linked to ERFLMRR and spread (plus or minus) will be determined by the sanctioning authority based on inherent credit and default risk in the product and customer per se arising from customer segment, profile of the customers, professional qualifications, stability in earning and employment and repayment ability, overall customer yield, risk premium, nature and value of primary and collateral securities, past repayment track record of customers, external rating of the customers, industry trends, tenor of customer relationship, offerings by competition etc. The company may adopt an interest rate model whereby the rate of interest for the same product and tenor availed during the same period by customers would be different from customer to customer depending upon consideration of any or combination of a few or all factors listed above. Hence the rate of interest applied would be different from customer to customer and his / her loans.

    All the LAP loans made by ERFL shall generally provide for reset of interest rate unless sanctioning authority decides for a fix rate of interest. The sanctioning authority shall decide the periodicity of interest reset. The reset shall be linked to the prevailing ERFLMRR.

    Processing Fee / Upfront Fee
    Processing fee shall be determined by the sanctioning authority on the basis of the quantum of work involved in credit appraisal, volume of documentation involved, other expenses involved in the transaction and negotiation with client. The Risk & Asset Liability Management Committee of the Board of Directors of ERFL may from time to time review the guidelines for charging processing fee or prescribe fixed processing for a particular product. The sanctioning authority shall have power to reduce / waive the processing fee on case to case basis.

    Calculation of MRR (For Incremental Loan on a Base Amount of INR 100)
        Fig in INR
    A
    a.1
    a.2
    Fund Requirement for Loan Amount of INR 100
    Loan Amount
    RBI Capital Adequacy Requirement (CRAR)
    Current : 15%
    B
    b.1
    b.2
    Funding Composition
    Own Capital
    Borrowed Funds
    C
    c.1

    c.2
    Funding Cost
    Cost of Own Capital
    (Assumed flat rate of 21%)
    Borrowing Cost
    (Weighted Rate for last 6 months + 200 Basis point spread)
    D General Provisioning for Standard Assets
    E Risk Margin / Credit Cost  
    F Administrative Cost  
      ERFLMRR

    Policy for determining Interest Rates and Processing and other charges

    As stipulated by the Reserve Bank of India (RBI), the Board of Directors of Edelweiss Retail Finance Limited (ERFL) in their meeting held on February 25, 2015 had laid down the policy for determining Interest Rates, Processing and other charges for the Small and Medium Enterprise Loans (SME Loans) product. The said policy has been framed in the light of RBI circular Ref. No. RBI/2008-09/337/DNBS(PD)/CC. No. 133/03.10.001/2008-09 dated January 2, 2009 and is as under:

    Interest Rate
    The interest rates charged by ERFL shall be linked with the ERFL Small and Medium Enterprise Reference Rate (ERFLSMERR). ERFLSMERR shall be determined by the Risk & Asset Liability Management Committee of the ERFL on the basis of the cost of borrowing of ERFL, operating cost, liquidity and interest rate trend in the market and return on equity.

    The Risk & Asset Liability Management Committee of the Board of Directors of ERFL shall review ERFLSMERR on such periodicity as may be deemed necessary by the Risk & Asset Liability Management Committee of the Board of Directors of ERFL and modify the same depending upon the market trends. The Risk & Asset Liability Management Committee of the Board of Directors of ERFL will adopt the basic formula as provided below for determining ERFLSMERR with such modification as may be deemed necessary by the Risk & Asset Liability Management Committee of the Board of Directors of ERFL.

    The interest rate shall be linked to ERFLSMERR and spread (plus or minus) will be determined by the sanctioning authority based on inherent credit and default risk in the product and customer per se arising from customer segment, profile of the customers, professional qualifications, stability in earning and employment and repayment ability, overall customer yield, risk premium, nature and value of primary and collateral securities, past repayment track record of customers, external rating of the customers, industry trends, tenor of customer relationship, offerings by competition etc. The company may adopt an interest rate model whereby the rate of interest for the same product and tenor availed during the same period by customers would be different from customer to customer depending upon consideration of any or combination of a few or all factors listed above. Hence the rate of interest applied would be different from customer to customer and his / her loans.

    All the SME loans made by ERFL shall generally provide for reset of interest rate unless sanctioning authority decides for a fix rate of interest. The sanctioning authority shall decide the periodicity of interest reset. The reset shall be linked to the prevailing ERFLSMERR.

    Processing Fee / Upfront Fee
    Processing fee shall be determined by the sanctioning authority on the basis of the quantum of work involved in credit appraisal, volume of documentation involved, other expenses involved in the transaction and negotiation with client. The Risk & Asset Liability Management Committee of the Board of Directors of ERFL may from time to time review the guidelines for charging processing fee or prescribe fixed processing for a particular product. The sanctioning authority shall have power to reduce / waive the processing fee on case to case basis.

    Calculation of ERFLSMERR (For Incremental Loan on a Base Amount of INR 100)
        Fig in INR
    A
    a.1
    a.2
    Fund Requirement for Loan Amount of INR 100
    Loan Amount
    RBI Capital Adequacy Requirement (CRAR)
    Current : 15%
    B
    b.1
    b.2
    Funding Composition
    Own Capital
    Borrowed Funds
    C
    c.1

    c.2
    Funding Cost
    Cost of Own Capital
    (Assumed flat rate of 21%)
    Borrowing Cost
    (Weighted Rate for last 6 months + 200 Basis point spread)
    D General Provisioning for Standard Assets
    E Risk Margin / Credit Cost  
    F Administrative Cost  
      ERFLSMERR

    Policy for determining Interest Rates and Processing and other charges

    As stipulated by the Reserve Bank of India (RBI), the Board of Directors of Edelweiss Retail Finance Limited (ERFL) in their meeting held on February 25, 2015 had laid down the policy for determining Interest Rates, Processing and other charges for the Micro Finance Loans (MF Loans) product. The said policy has been framed in the light of RBI circular Ref. No. RBI/2008-09/337/DNBS(PD)/CC. No. 133/03.10.001/2008-09 dated January 2, 2009 and is as under:

    Interest Rate
    The interest rates charged by ERFL shall be linked with the ERFL Micro Finance Reference Rate (ERFLMFRR). ERFLMFRR shall be determined by the Risk & Asset Liability Management Committee of the ERFL on the basis of the cost of borrowing of ERFL, operating cost, liquidity and interest rate trend in the market and return on equity.

    The Risk & Asset Liability Management Committee of the Board of Directors of ERFL shall review ERFLMFRR on such periodicity as may be deemed necessary by the Risk & Asset Liability Management Committee of the Board of Directors of ERFL and modify the same depending upon the market trends. The Risk & Asset Liability Management Committee of the Board of Directors of ERFL will adopt the basic formula as provided below for determining ERFLMFRR with such modification as may be deemed necessary by the Risk & Asset Liability Management Committee of the Board of Directors of ERFL.

    The interest rate shall be linked to ERFLMFRR and spread (plus or minus) will be determined by the sanctioning authority based on inherent credit and default risk in the product and customer per se arising from customer segment, profile of the customers, professional qualifications, stability in earning and employment and repayment ability, overall customer yield, risk premium, nature and value of primary and collateral securities, past repayment track record of customers, external rating of the customers, industry trends, tenor of customer relationship, offerings by competition etc. The company may adopt an interest rate model whereby the rate of interest for the same product and tenor availed during the same period by customers would be different from customer to customer depending upon consideration of any or combination of a few or all factors listed above. Hence the rate of interest applied would be different from customer to customer and his / her loans.

    All the Micro Finance loans made by ERFL shall generally provide for reset of interest rate unless sanctioning authority decides for a fix rate of interest. The sanctioning authority shall decide the periodicity of interest reset. The reset shall be linked to the prevailing ERFLMFRR.

    Processing Fee / Upfront Fee
    Processing fee shall be determined by the sanctioning authority on the basis of the quantum of work involved in credit appraisal, volume of documentation involved, other expenses involved in the transaction and negotiation with client. The Risk & Asset Liability Management Committee of the Board of Directors of ERFL may from time to time review the guidelines for charging processing fee or prescribe fixed processing for a particular product. The sanctioning authority shall have power to reduce / waive the processing fee on case to case basis.
    Calculation of ERFLMFRR (For Incremental Loan on a Base Amount of INR 100)
        Fig in INR
    A
    a.1
    a.2
    Fund Requirement for Loan Amount of INR 100
    Loan Amount
    RBI Capital Adequacy Requirement (CRAR)
    Current : 15%
    B
    b.1
    b.2
    Funding Composition
    Own Capital
    Borrowed Funds
    C
    c.1

    c.2
    Funding Cost
    Cost of Own Capital
    (Assumed flat rate of 21%)
    Borrowing Cost
    (Weighted Rate for last 6 months + 200 Basis point spread)
    D General Provisioning for Standard Assets
    E Risk Margin / Credit Cost  
    F Administrative Cost  
      ERFLMFRR
    Recovery Agency

    Vaishnavi Management Pvt. Limited
    Address- Unit No. 6/6B,
    Udit Mittal INDL. Premises CO-OP. Society
    Andheri, Kurla Road,
    Andheri (East), Mumbai-400059
    Edelweiss Financial Services Limited 2016

    Edelweiss Retail Finance Limited (ERFL) | CIN: U67120MH1997PLC285490

    The Company is having valid Certificate of Registration (CoR) No. B-13.02149 dated January 4,2017 issued by Reserve Bank of India (RBI) under Reserve Bank of India Act, 1934. However, RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of Company or correctness of any of the statements or representation made or opinion expressed by the Company.

    Edelweiss Housing Finance Limited (EHFL) | CIN: U65922MH2008PLC182906

    EHFL is regulated by the National Housing Bank (NHB) vide Certificate of Registration (CoR) No. 03.0081.10 dt. 18/03/2010. However, NHB does not accept any responsibility or guarantee about the present position as to the financial soundness of Company or correctness of any of the statements or representation made or opinion expressed by the Company.

    Best viewed in 1280X720 resolution in Google Chrome, Mozilla Firefox, Safari, IE 10 and above.