RBI cautions NBFCs on transaction in Iran, Pakistan, North Korea - India News and Travel Times Provides India-centric and other News and Features

The Reserve Bank of India (RBI) has directed Non-Banking Financial Companies (NBFCs) to be alert while transacting business from countries like Iran, Pakistan and North Korea. According to the RBI, the Financial Action Task Force (FATF), an international agency, has identified these countries as having lax anti money laundering and terror financing laws. The FATF was set up by the G-7 summit in Paris. The FATF aims at generating necessary political will to bring about national legislative and regulatory reforms to combat money laundering. In a notification, the RBI said all NBFCs are accordingly advised to take into account risks arising from deficiencies in combating of financing of terrorism regime of these countries. Earlier in the week, New Delhi had informed Islamabad that it is seeking membership of the FATF as it would strengthen the nation's capacity to track terror funding from across the borders.