Sebi relaxes some KYC rules for mutual fund investors
MUMBAI : Sebi has relaxed the Know Your Customer (KYC) requirements for mutual fund (MF) investors, residents, and non-resident Indians (NRIs) following consumer feedback. Mint has seen a copy of a mail sent by the Securities and Exchange Board of India (Sebi) to industry participants. NRIs have been given a breather of one year for completing KYC requirements following representations from them about difficulty in passport validation.
Similarly, Sebi has allowed MF investors to get validated through either email or mobile verification rather than both. Finally, non-verified investors have been allowed to redeem their investments, subject to due diligence by intermediaries. “We will have to wait for clear instructions from the KYC Registration Agencies (KRAs)," said Viral Bhatt, a mutual fund distributor and founder of Money Mantra.
Also Read: Sebi relaxes draconian KYC norms to simplify risk management framework To be sure, mutual fund investors were required to verify their phone number and email with the KRAs failing which their KYC status would go ‘on hold’ from 1 April 2024. Investors also needed to update their KYC using Aadhaar cards as the proof documents, if not done earlier, and get the ‘validated’ status to freely transact in new AMCs. Accounts that did KYC but used an officially valid document (OVD) other than Aadhaar card were tagged as ‘verified’.
This allowed them to sell their existing investments freely but had restrictions on buying schemes from new AMCs. They had to re-do KYC every time they wanted to invest in a new AMC or do a KYC again using Aadhaar and get the ‘validated’ tag. Also Read: Sebi tells investment advisors to share details of all their social media handles every six months NRIs had
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