KYC, change of
bank mandate are among the major challenges faced by IFAs
Market regulator SEBI had invited Foundation of Independent
(FIFA) today to get its feedback on the
operational hurdles faced by distributors. The meeting was chaired by R K
Agarwal, Whole Time Member of SEBI and six directors of FIFA.
asked us to give the viewpoints of all IFAs regarding operational issues faced
by them. SEBI was receptive to the concerns highlighted by us. We also brought
to their notice that the income levels of IFAs has gone down after the ban on
loads,” says Yogesh Sharma, Director, FIFA.
uniform KYC rule introduced by SEBI which requires IFAs to get in-person
verification is said to have been acting as a deterrent for getting new
clients. IFAs have long been requesting that their nominees should be entitled
to trail commission in the event of their death even if the nominee is not an
SEBI had mandated KYC for all investors in mutual funds irrespective of the
ticket size. Earlier KYC was required only for investment of Rs 50,000 or
above. IFAs have been contesting that their investors don’t need to go through
the KYC process again if they are already KYC compliant with banks.
have also been requesting the industry to introduce a common application for
investing in all fund houses. Apart from these issues, IFAs are facing hurdles
in changing bank mandates for their clients. “There are a lot of formalities
required for changing your bank mandate. It is really time consuming. Also some
fund houses don’t accept KYC from NSDL,” says Gajendra Kothari of Etica Wealth