The Government of India has amended the Prevention of Money Laundering (Maintenance of Records) Rules, 2005 to make the Know Your Customer (KYC) process more flexible and citizen-friendly. The amendment, notified on November 13, 2019, permits individuals to use their Aadhaar number for identification while declaring a current address different from the one recorded in their Aadhaar document.
Purpose of the Amendment
The change aims to simplify the KYC process and make it more inclusive, especially for people who frequently change their residence due to work or other reasons. Under the amended Rule 9, if a person provides their Aadhaar number for identification and wishes to use a different current address, they can now simply give a self-declaration of that address to the reporting authority, such as a bank or financial institution.
This means customers no longer need to produce additional documents—like rent agreements or utility bills—to update their address for banking purposes.
Impact on Customers and Financial Institutions
The amendment has made it easier for individuals to open and operate bank accounts even when their current residence does not match the address printed on their Aadhaar card.
* For Bank Customers: They can now provide their current address through a simple written declaration, without the hassle of collecting supporting documents.
* For Banks:This change reduces paperwork and speeds up account opening while maintaining compliance with anti-money laundering norms.
Benefits to Migrant Workers and Mobile Populations
This policy particularly benefits migrant workers, who often face challenges in opening bank accounts at their place of work because their Aadhaar reflects their permanent or native address. The ability to declare a current address on a self-declaration basis removes this barrier and supports greater financial inclusion.
Similarly, government employees, professionals, or individuals frequently transferred between cities will find this rule helpful. They no longer need to provide proof such as rent agreements or employer letters to update their bank records each time they move.
Wider Applicability
The provision also helps individuals who wish to use a workplace address as their current address for operational convenience while retaining their permanent address on Aadhaar. It supports the practical needs of people whose living or work situations change often.
Conclusion
The amendment to the Prevention of Money Laundering Rules represents a balanced approach between regulatory compliance and customer convenience. By allowing self-declaration of the current address while using Aadhaar for identification, the government has eased the KYC process, strengthened financial inclusion, and reduced unnecessary procedural hurdles.
This step aligns with India’s ongoing efforts to create a more accessible, technology-driven, and inclusive financial system, where compliance requirements are met without burdening genuine customers.
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