Siddartha S. Karnani on MCA’s Risk-Based Approach to Director KYC Compliance
Siddartha S. Karnani, commenting in a recent Business Standard article on the Ministry of Corporate Affairs’ decision to ease KYC compliance requirements for directors, highlighted the move as a calibrated and risk-based regulatory intervention.
According to him, shifting the KYC filing requirement to once every three years reflects a pragmatic approach that balances regulatory oversight with ease of compliance. He noted that the change significantly reduces the compliance burden on both regulated entities and individuals, particularly in cases where customer profiles and transaction patterns remain stable.
Siddartha further observed that the revised framework achieves this simplification without diluting the core objectives of India’s anti-money laundering and counter-terrorist financing regime. By retaining safeguards while easing procedural frequency, the MCA has signalled a move toward more proportionate regulation aligned with global best practices.
His remarks highlight a broader regulatory trend toward risk-based compliance models that enhance efficiency, improve governance outcomes, and support the ease of doing business, while continuing to safeguard financial integrity.
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