What is Politically Exposed Person (PEP) – Management of PEPs
Also Check: [What is the Asaan Karobar Finance Scheme and How to Apply it?]
What is a Politically Exposed Person (PEP)?
A Politically Exposed Person (PEP) is an individual who currently holds or has previously held a high-ranking public position. This can be within their own country, a foreign country, or in an international organization. The main categories of PEPs include:
Foreign Politically Exposed Persons
These include senior politicians and high-ranking officials from foreign countries, such as Presidents, Prime Ministers, Judges, Military Leaders, Executives of Government Companies, senior government officials, and key members of political parties.
Domestic Politically Exposed Persons
These are individuals holding similar high-profile positions within their own country. Examples include Members of the National Assembly (MNAs) and Members of the Provincial Assembly (MPAs). However, unsuccessful election candidates are not considered PEPs.
International Organization PEPs
These consist of senior officials working for international organizations like the United Nations (UN), the International Monetary Fund (IMF), and the World Bank.
Notes:
Close Associates of PEPs
Close associates are individuals who have business or financial relationships with a PEP. This includes business partners, beneficiaries of companies established for the benefit of a PEP, or people closely connected to a PEP either professionally or socially.
Family Members of PEPs
Family members include the spouse, children, parents, grandparents, and siblings of a PEP.
Additional Definitions
Helpline Number
If you need assistance or have any questions about the Asaan Karobar Finance Scheme or the Asaan Karobar Card, feel free to call the official toll-free helpline:
The support team is available to guide you through the application process, eligibility, and any related queries.
Conclusion
A Politically Exposed Person (PEP) is someone who holds—or has held—a prominent public position either in their own country, abroad, or within an international organization. This includes Foreign PEPs, Domestic PEPs, and International Organization PEPs.
While senior officials (such as MNAs, MPAs, high-ranking military officers, and key executives) fall under this category, mid- and lower-level officials are not classified as PEPs. In addition, family members (like spouses, children, and parents) and close associates (business partners or financial affiliates) are also considered related to PEPs and may require due diligence in financial transactions.
Understanding and managing PEPs is crucial for financial institutions to maintain transparency, prevent corruption, and comply with international anti-money laundering (AML) regulations.
