NBS Bank says it has blocked about 40 percent of its customers’ accounts for not updating them under the Know Your Customer (KYC) exercise which ended on October 31 2018.
NBS Bank chief commercial officer Phillip Madinga told journalists in Blantyre on Thursday that over the past months, the bank has been asking customers to update their accounts to comply with the Reserve Bank of Malawi (RBM) regulations.
“We used different channels to communicate this requirement to customers, including the print and electronic media.
“A good number of customers came forward to update their information, although some who came forward did not provide all the information required and the bank is in the process of contacting them to provide missing information,” he said.
Madinga assured customers that updating their KYC information is a legal requirement designed to protect them and the bank against fraud and money laundering.
“We assure our customers with their accounts restricted that their funds are safe and we ask them to come forward to provide the required information,” he said.
The Malawi Stock Exchange (MSE)-listed bank started the exercise in February this year to allow customers to update their information after RBM instructed commercial banks and other financial institutions to comply with the Banking Act 1989.
The Act provides safe and sound banking practices to maintain the integrity of the financial sector.
According to RBM, some of the objectives of KYC are to ensure that commercial banks and financial institutions establish and regularly maintain policies, practices and procedures designed to determine the true identity of their customers as well as their customers’ normal and expected transactions and sources of funds.
This is to ensure that the financial sector complies with international conventions and initiatives by international bodies in the prevention of the criminal use of the financial system. n