Reserve Bank of India has directed all banks to open no frill bank accounts for students of minority community so that they are facilitated to avail government scholarships and other similar benefits.

"It has been brought to our notice by Ministry of Minority Affairs Secretary that banks are not opening ‘no-frills' accounts in favour of students from minority communities who wish to avail of the scholarships being awarded by the Ministry through the State/UT governments," RBI said in a statement.

The statement also places concern over the inconveniences caused to these students because of this issue and also because of the unwanted criticism caused.

However, the apex bank has made it a point that banks must follow Know Your Customer (KYC) norms even opening accounts for these customers also.