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Unjust tirade: Need for soul searching on the state of Indian economy

If the KYC norms are not followed strictly, toxic accounts could creep into the system

Business Standard 

Nirmala Sitharaman
Union Finance Minister Nirmala Sitharaman during a press conference after a cabinet meeting. PTI

This refers to “The curious case of an upset FM & an apologetic banker’’ by Tamal Bandyopadhyay (March 18). The author has raised some pertinent questions in the piece. The ferocious tone and words used in the interaction appearing in the alleged video were surprising. The issue raised in the meeting in Assam was that a large number of accounts were not being made operational by the banks. These accounts are kept inactive due to Know Your Customer (KYC) formalities not being completed. The SBI cannot be faulted on this score. There have been cases in the past where some accounts have been used for nefarious activities.

The northeast is a sensitive area with a large floating population because of the problem of infiltration. If the norms are not followed strictly, toxic accounts could creep into the system. This could then be used for illegal activities. Do we want this to happen? Also, if the local government feels there is a genuine reason why the affected people cannot provided adequate papers to fulfil the norms, what are they doing to ensure that the prospective account holders have access to or are issued such documents?

Local-level politicians are known to take up issues of their constituents without really studying and understanding the ground realities or the reasons for the perceived gaps when banks don’t oblige. We have to be mindful of the fact that the operations of the SBI operates is wide. If the SBI boss can be called to account for something that is amiss in one corner of the country, there should be some soul searching on the state of the country’s economy also. K V Premraj Mumbai

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First Published: Wed, March 18 2020. 21:15 IST