In line with circular dated November 06, 2024 (Amendment) by Reserve Bank of India.
This KYC Policy is crafted by MST to articulate the procedures and principles governing customer identification and verification in alignment with regulatory requirements as stipulated by the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), and other pertinent authorities. The paramount objective of this policy is to mitigate risks associated with money laundering, terrorist financing, and other illicit activities.
2.1. Customer Due Diligence (CDD): Customer identification will be rigorously performed, involving the verification of personal details, residential address, and pertinent particulars. For individuals, the accepted documents may include Aadhar cards, PAN cards, passports, voter IDs, or other government-issued identification documents. Non-individual customers shall provide incorporation documents, partnership deeds, or business-related documentation.
2.2. Enhanced Due Diligence (EDD): EDD protocols will be implemented for high-risk customers, transactions, or business associations, potentially requiring additional information and continuous monitoring. MST may from time to time decide in accordance with government recommendations who will be categorized as “High Risk Customers”. Enhanced customer due diligence may be requested upon High-Risk Customers or any other category of Customers whom MST may deem appropriate.
2.3. Ongoing Monitoring: Continuous surveillance of customer transactions will be executed to detect suspicious activities, validate data accuracy, and periodically reassess customer risk profiles.
The institution shall apply the Customer Due Diligence procedure at the Unique Customer Identification Code (UCIC) level, ensuring that each customer is assigned a unique identifier within the institution’s records. If an existing KYC-compliant customer wishes to open an additional account or avail of any new product or service from the institution, a fresh CDD process for customer identification shall not be required, provided that the customer’s KYC records are up to date and compliant with regulatory requirements.
Notwithstanding the above, the institution shall conduct a risk assessment at the time of onboarding the customer for a new account or service. If there is any material change in the customer’s profile, financial behavior, or risk categorization, the institution may seek additional KYC documentation or conduct an enhanced due diligence (EDD) process, as deemed necessary. The institution shall ensure that all customer records linked to the UCIC remain updated and periodically reviewed in accordance with regulatory guidelines to maintain accuracy and compliance.
In cases where an existing customer’s KYC records are incomplete, outdated, or flagged for review, the institution shall require the customer to update their information before allowing them to open a new account or avail of additional services.
The institution shall implement internal controls and technological measures to track and enforce the UCIC-based KYC compliance process, ensuring that no duplicate or redundant CDD exercises are conducted for the same customer, thereby enhancing efficiency and regulatory adherence.
4.1. Suspicious Transaction Reporting: MST is firmly committed to the timely reporting of suspicious transactions to the relevant authorities as per the stipulations of the Financial Intelligence Unit (FIU-IND).
4.2. Record-keeping: The company will maintain records of customer identification and transaction data for a minimum of five years post the conclusion of the customer relationship.
MST shall ensure that all KYC records are accurately maintained and updated in compliance with regulatory requirements. In line with the prescribed guidelines:
5.1. MST shall ensure that KYC data for all individual and legal entity (LE) customers is incrementally uploaded or updated in the Central KYC Registry (CKYCR) in accordance with regulatory directives.
5.2. As part of the periodic KYC updation process, MST shall update KYC details for accounts opened prior to the stipulated regulatory deadlines either at the time of periodic KYC review (as per Paragraph 38 of the Master Direction) or earlier if updated KYC information is obtained from the customer.
5.3. MST shall adhere to all mandatory data submission timelines and format requirements to ensure seamless integration with CKYCR and avoid non-compliance risks.
5.4. Customers shall be duly informed regarding the need for periodic KYC updates, and MST shall facilitate the collection of updated documentation where required.
6.1. Employee Training: We will ensure that employees receive comprehensive training on KYC policies and procedures to guarantee effective implementation.
6.2. Customer Awareness: Customers will be educated on KYC policies, their significance, and their role in upholding compliance with these policies.
MST harnesses technology and automation to enhance customer identification and verification processes, facilitate risk assessment, and automate transaction monitoring.
Non-compliance with this KYC Policy and related regulations may result in penalties, legal actions, and potential termination of business relationships in accordance with applicable laws and regulations.
In adherence to the laws and regulations of India, the listed Know Your Customer (KYC) details provided by customers are expected to comply with the statutory requirements applicable within the jurisdiction of India. The Platform currently is open only to citizens of India. Hence, all compliances as required under law shall be followed and the users shall cooperate accordingly. Foreign nationals residing in India are subject to a specific KYC process. As part of this process, we may request proof of residence, proof of indemnity, and any additional documentation deemed necessary for the purpose of residence in India. Additionally, proof of income may be required to fulfill KYC requirements. This is to ensure compliance with relevant regulations and maintain the integrity of our KYC procedures. Users are requested to provide the necessary documentation for a thorough and accurate KYC process.
Foreign residents, whether residing in India or outside, are prohibited from opening an account if their country of residence is listed on the Financial Action Task Force (FATF) blacklists. The list of blacklisted countries is based on the latest information provided by FATF and is subject to change. Individuals from countries identified on the FATF blacklists are not eligible for account registration until the country’s status is revised and removed from the blacklist. We reserve the right to enforce this restriction in accordance with our policies and regulatory requirements. For the latest information on FATF black and grey lists, please refer to fatf-gafi.org/en/countries/black-and-grey-lists.html.
MST shall categorize customers based on risk levels to ensure effective monitoring and due diligence. Customers will be classified as low, medium, or high risk based on their transaction history, geographic location, business activities, and source of funds.
High-risk customers shall include individuals or entities with complex ownership structures; customers engaged in large or frequent international transactions; politically exposed persons (PEPs) and their associates; customers from jurisdictions identified as high-risk by regulatory authorities.
The classification of high-risk accounts shall be subject to enhanced due diligence (EDD) and more frequent monitoring to detect suspicious transactions. Additionally, periodic reassessment and updating of customer profiles shall be conducted, considering changes in financial behavior, business activities, or regulatory guidelines..
MST shall ensure that the categorization process remains dynamic, with any new risk parameters introduced by regulators being incorporated promptly into the monitoring framework.
Customers identified as politically exposed persons shall be subject to enhanced due diligence to prevent the misuse of financial systems. PEPs include individuals who hold or have held high-ranking public positions in India or foreign jurisdictions, such as heads of state, government officials, judiciary members, military officers, and executives of state-owned enterprises. When onboarding a PEP, senior management approval shall be required, and additional scrutiny shall be applied to their transactions and source of funds. The relationship with a PEP shall be continuously monitored for any unusual activity, and in cases where the risk is deemed excessive, MST reserves the right to refuse or terminate the business relationship.
MST shall leverage digital identity verification solutions, including biometric authentication, video KYC, and document verification, to ensure a seamless and secure KYC process. To enhance compliance and minimize fraud risks, the verification of customer identities may be conducted through authorized third-party service providers approved by regulatory authorities. Customers may be required to complete Aadhaar-based eKYC authentication, mobile number OTP verification, and additional checks to validate their identity and address. All digital verification methods shall comply with data protection laws and regulatory guidelines to maintain the security and confidentiality of customer information.
For corporate entities, partnerships, and other non-individual customers, MST shall identify and verify the beneficial owners who ultimately control or hold significant ownership in the entity. A beneficial owner is any individual holding a direct or indirect ownership stake of 25% or more, or an individual exercising effective control over the business. Customers shall be required to provide supporting documents, including declarations of beneficial ownership, KYC details of key stakeholders, and organizational structure information. The beneficial ownership records shall be maintained in accordance with regulatory requirements and updated periodically to ensure accuracy and compliance.
All customer transactions shall be subject to real-time and periodic monitoring to identify suspicious activity. MST shall implement automated transaction monitoring systems that analyze customer behavior, identify unusual patterns, and flag transactions that deviate from expected financial activity. Transactions involving high-value fund transfers, frequent international remittances, structuring to evade reporting requirements, or connections to high-risk jurisdictions shall be subject to additional scrutiny. Any transaction that raises suspicion shall be escalated to the compliance team for further investigation, and if deemed necessary, reported to the Financial Intelligence Unit (FIU-IND) in accordance with applicable laws and regulations.
This KYC Policy will undergo periodic reviews and updates to ensure conformity with shifting regulatory standards, evolving risk factors, and operational requirements. As part of this process, MST shall ensure that KYC records are periodically updated in accordance with regulatory guidelines, including routine updation cycles for customer KYC details based on risk classification; mandatory KYC revalidation at prescribed intervals for high-risk customers; ensuring that any updated KYC information is promptly recorded in internal systems and the Central KYC Registry (CKYCR) as per applicable regulations; incorporating any new directives from regulators regarding customer due diligence, documentation requirements, and risk monitoring.
Any amendments to this policy, including periodic KYC updation requirements, will be communicated to employees and customers to maintain transparency and compliance.
MST is resolute in implementing robust KYC procedures to ensure the integrity of its business operations and unwavering compliance with Indian laws and regulations. This policy serves as the cornerstone for upholding the highest standards of transparency and security in all interactions with our valued customers.