Corporate affairs ministry to collect KYC details of Companies, Professionals

The Corporate Affairs Ministry is planning to collect KYC details of companies, chartered accountants, cost accountants and company secretaries.  A senior ministry official said the exercise would help in having a “sanitised list” of companies and professionals.

Last year, the ministry carried out the Know Your Customer (KYC) initiative for directors to ascertain their identities as part of larger efforts to clamp down on entities that are suspected to be conduits for illicit fund flows.

Against 33 lakh individuals who had Director Identification Numbers (DINs), little over 16 lakh have complied with the KYC requirement. Srinivas said the ministry would be doing the KYC process for companies, which would be a major step wherein the MCA21 system would not register the companies in case they are non-compliant with certain parameters.

“If you are defaulting in payment of deposits, system will not let you register. If you are having non-compliant directors who have not done KYC, the system will not let you enter. “So the company will be forced to either remove the director or make the director compliant and then get into the system,” Srinivas told.