Bank of baroda

Deposit Insurance
Demand and time deposits of up to Rs. 100,000 accepted by Indian banks have to be compulsorily insured with the
Deposit Insurance and Credit Guarantee Corporation, a wholly-owned subsidiary of the RBI. Banks are required to pay
the insurance premium for the eligible amount to the Deposit Insurance and Credit Guarantee Corporation on a semi-
annual basis. The cost of the insurance premium cannot be passed on to the customer.
Regulations relating to Knowing the Customer and Anti-Money Laundering
The RBI has issued several guidelines relating to identification of depositors and has advised banks to put in place

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BANK OF BARODA
systems and procedures to control financial frauds, identify money laundering and suspicious activities, and monitor high
value cash transactions. The RBI has also issued guidelines from time to time advising banks to be vigilant while opening
accounts for new customers to prevent misuse of the banking system for perpetration of frauds.
The RBI requires banks to open accounts only after verifying the identity of customers as to their name, residence and
other details to ensure that the customer is opening the account in his own name. To open an account, a prospective
customer is required to be introduced by an existing customer who has had his own account with the bank for at least
six months and has satisfactorily conducted that account, or a well-known person in the local area where the prospective
customer resides.
If the prospective customer does not have an introducer, the prospective customer is required to submit documents such
as his identity card, passport or details of bank accounts with other banks. It must be made incumbent upon him to
provide sufficient proof of his antecedents before the account is allowed to be opened.
The Prevention of Money Laundering Act, 2002 has been passed by Indian Parliament and has received the assent of
the President of India on January 17, 2003. The Act seeks to prevent money laundering and to provide for confiscation
of property derived from, or involved in, money laundering and for incidental and connected matters.