RBI/2004-05/
137
UBD. PCB. Cir. No. 14 /09.11.01/2004-05 August 24
, 2004 The Chief Executive Officers of all
Primary (Urban) Co-operative
Banks Dear Sir, Opening of Current Accounts
by banks - Need for discipline Please
refer to our circular UBD.
PCB. Cir. No. 7 / 09.11.01/2004-05 dated July 29, 2004 on the above subject. 2.
In this connection, it is clarified that where the due diligence is carried out
on the request of a prospective customer who is a corporate or large borrower
enjoying credit facilities from more than one bank, the banks may inform the consortium
leader, if under consortium, and the concerned banks, if under multiple banking
arrangement. 3. Banks may open current accounts of prospective
customers in case no response is received from the existing bankers after a minimum
waiting period of a fortnight. If a response is received within a fortnight, banks
should assess the situation with reference to information provided on the prospective
customer by the bank concerned and are not required to solicit a formal no objection,
consistent with true freedom to the customer of banks as well as needed due diligence
on the customer by the bank. 4. Banks are advised to be
guided by the need for effective due diligence in these matters as also the objective
of customer satisfaction and ensure that suitable arrangements are in place for
prompt and serious attention to references received from banks in this regard. Yours
faithfully, sd/ (N.S.Vishwanathan)
Chief
General Manager
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