State the obligation of banks on KYC policy as per guidelines issued by Reserve Bank of India.

Obligation of Banks on KYC Policy issued by Reserve Bank of India are as follows: Banks should keep in mind that the information collected from the customer for the purpose of opening of account is to be treated as confidential and details thereof are not to be divulged for cross selling or any other like purposes. Banks should, therefore, ensure that information sought from the customer is relevant to the perceived risk, is not intrusive, and is in conformity with the guidelines issued in this regard. Any other information from the customer should be sought separately with his/her consent and after opening the account. Banks should ensure that any remittance of funds by way of demand draft, mail/telegraphic transfer or any other mode and issue of travellers' cheques for value of Rupees fifty thousand and above is effected by debit to the customer's account or against cheques and not against cash payment. Banks should ensure that the provisions of Foreign Contribution (Regulation) Act as amended from time to time, wherever applicable are strictly adhered to.