DoT imposes new KYC riders for biz connections, move aimed to prevent online fraud, ET Telecom

New Delhi: The Department of Telecommunications (DoT) has put in additional know-your-customer (KYC) conditions for getting business connections, earlier called bulk conditions, in cases where the end users are not identifiable. The move is aimed to stop online fraud and meet specific needs of the industry.

In such a scenario, only telecom operators can issue connections after taking an undertaking from the subscribing entity that the SIMs would be used for specific purposes like testing etc. The retailers won’t be allowed to issue such connections as KYC of every number won’t be done in such cases.

The telcos can also issue a maximum of upto 100 connections for any given entity at a given time and such connections should not be used for machine-to-machine communications.

In August last year, DoT had made KYC mandatory for every SIM, even in case of business connections. But the industry was facing issues with this provision as in certain instances, the bulk connections have not identifiable end users, so the KYC can’t be done.

“In those scenarios where end-users are not identifiable in a business connection such as SIMs obtained for R&D & testing activities for a specified purpose, the requirement of end-user KYC is optional,” DoT said in its directions issued to telecom operators on Monday.

However, for this category of customers, mobile connections shall be issued by the licensee’s employees only, the DoT added.

Putting in additional safeguards, the DoT said before issuing such connections, the telco shall obtain an undertaking from the subscribing entity detailing the use case scenarios having no end users and the telco should satisfy itself that the use cases are realistic.

“During physical verification of the entity’s address and premises before issuing such connections, the licensee shall verify that the proposed use case scenarios of the subscribing entity are realistic,” the DoT said.

Further, the telco should monitor use of such connections by the subscribing entities.

The telcos should inform in writing to the subscribing entity that the responsibility of bonafide usage of such business connections lies with the subscribing entity. “If it comes into the notice of licensee, licensor, or designated LEAs about misuse of these connections by the subscribing entities, such business connections shall be disconnected immediately without prejudice to any other action that may be taken under the law,” the DoT added.

The telcos are required to provide such connections with limited call/SMS/data facility with a definite validity period of maximum one year at a time as per the use case scenarios of subscribing entities.

During the renewal of validity, the telco should satisfy itself by usage patterns from the past as well as proposed usage for the upcoming year.

Further, it is also clarified that the license conditions related to ‘bulk connections’, and ‘bulk users’ in the existing license agreements, shall also be applicable mutatis mutandis for ‘business connections’ and ‘business users’.

Resale of SIMs by business connections subscribing entities is not permitted and the telcos shall ensure that subscribing entities obtain mobile connections for their own use and shall not obtain such connections for third parties.