FIU-IND and RBI Sign MoU to Bolster Anti-Money Laundering Efforts

This strategic alliance between FIU-IND and RBI reflects India’s broader commitment to combat economic crimes, money laundering, and illicit financial flows.

In a significant step toward strengthening India's financial regulatory framework and enhancing the fight against money laundering and terror financing, the Financial Intelligence Unit-India (FIU-IND) and the Reserve Bank of India (RBI) signed a Memorandum of Understanding (MoU) today in New Delhi. The landmark agreement underscores a renewed commitment to inter-agency cooperation in enforcing the provisions of the Prevention of Money Laundering Act (PMLA), 2002, and the associated rules.

The MoU was formally signed by Shri Vivek Aggarwal, Director, FIU-IND, and Shri R.L.K. Rao, Executive Director of the Department of Regulation at RBI, in the presence of several senior officials from both organizations. Key attendees included Mr. Bedobani Chaudhuri, Additional Director, FIU-IND; Ms. Veena Srivastava, Chief General Manager, Department of Regulation, RBI; Mr. Avinash Kumar, Deputy Director, FIU-IND; and Mr. Sanjoy Ghosh, Financial Sector Expert at FIU-IND.

Objectives of the MoU

The primary objective of the MoU is to enhance coordination and information-sharing mechanisms between FIU-IND and RBI to ensure effective monitoring and compliance of financial institutions with anti-money laundering (AML) and countering financing of terrorism (CFT) regulations.

The collaboration aims to:

• Appoint dedicated nodal officers: Both institutions will nominate a primary nodal officer and an alternate nodal officer to facilitate streamlined communication and coordination.

• Exchange intelligence and data: The MoU outlines a structured mechanism for the timely sharing of relevant financial intelligence and information between the two agencies.

• Standardize reporting protocols: Clear guidelines will be established for how RBI-regulated entities report suspicious transactions and other compliance requirements to FIU-IND, as prescribed under the PML Rules.

• Training and outreach: Joint workshops, training sessions, and awareness programs will be conducted for regulated entities to improve their AML/CFT compliance capabilities.

• Risk assessment and red flag indicators: The agencies will collaborate to assess sector-specific risks related to money laundering and terror financing. This includes identifying patterns and indicators that could signify suspicious activity within the financial ecosystem.

• Monitor compliance: RBI and FIU-IND will jointly supervise how financial institutions comply with their obligations under PMLA, associated rules, and RBI’s regulatory guidelines.

• Align with global standards: The MoU encourages adherence to international AML/CFT best practices and guidelines, such as those set by the Financial Action Task Force (FATF).

• Quarterly review meetings: Both organizations will convene on a quarterly basis to review ongoing issues, evaluate progress, and update their cooperative strategies in light of emerging challenges.

A Collaborative Step Toward Financial Security

This strategic alliance between FIU-IND and RBI reflects India’s broader commitment to combat economic crimes, money laundering, and illicit financial flows. With financial systems becoming increasingly complex and technology-driven, inter-agency collaboration is key to preserving the integrity of the country's financial architecture.

FIU-IND, functioning under the Department of Revenue, Ministry of Finance, is India's central national agency responsible for receiving, processing, analyzing, and disseminating information relating to suspect financial transactions. The Reserve Bank of India, as the nation’s apex financial regulator, oversees a vast array of entities including banks, non-banking financial companies (NBFCs), payment service providers, and more.

By bringing together regulatory expertise and intelligence capabilities, this MoU marks a critical milestone in enhancing regulatory compliance and operational readiness across financial institutions in India. The partnership is also expected to further India’s international reputation as a committed member of the global financial and AML/CFT framework.

Looking Ahead

As financial crimes continue to evolve with advancements in digital transactions and cross-border transfers, the need for proactive and coordinated regulatory oversight becomes imperative. This MoU not only sets a precedent for institutional cooperation but also fortifies India’s resolve to safeguard its financial system from abuse and exploitation by criminal networks.

With this collaboration now formalized, stakeholders across the financial sector can expect improved guidance, more robust oversight, and a transparent compliance landscape in the ongoing war against money laundering and terror financing.