What will happen if I don't do KYC?

In instances where new customers fail to complete the KYC process, banks may choose to decline their applications for services. This is a preventive measure to mitigate potential risks associated with unidentified or unverified individuals.

For existing customers, banks also have the authority to enforce KYC compliance. If a customer's account is found to be non-compliant, the bank can take action to freeze the account until the necessary KYC procedures are fulfilled.

Freezing an account essentially restricts the customer's ability to make any transactions, including deposits, withdrawals, or transfers. This serves as a strong incentive for customers to promptly complete the KYC process and maintain their account's active status.

Banks have the discretion to manage their customer base in accordance with regulatory requirements. One such requirement is the Know Your Customer (KYC) process, which ensures that banks have a clear understanding of their clients' identities and financial backgrounds.

The KYC process is not only beneficial for banks but also for the overall financial system. It helps to prevent money laundering, terrorist financing, and other illegal activities by ensuring that financial institutions are not inadvertently facilitating criminal enterprises.