The Reserve Bank of India (RBI) has directed regional rural banks (RRBs) to keep a watch on transactions of customers with countries like Pakistan and Iran since concerns have been raised about the rules there in combating terror funding.
"Regional Rural Banks are accordingly advised to take into account, risks arising from the deficiencies in anti-money laundering (AML), combating of financing of terrorism (CFT) regime of Iran, Uzbekistan, Pakistan, Turkmenistan and Sao Tome and Principe," RBI said in a notification to RRBs.
The notification follows concerns raised by the Financial Action Task Force (FATF), an inter-governmental body, regarding AML and CFT norms in these countries.
Last month, the RBI had issued a similar direction to commercial banks on transactions of customers with these countries.
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