Post March 31, your clients with a bank account in a subsidiary of SBI cannot execute fresh investments and SIPs in mutual funds unless they have not submitted a cheque of their new account.
Last year, in April 2017, six subsidiary banks of SBI – State Bank of Bikaner and Jaipur (SBBJ), State Bank of Hyderabad (SBH), State Bank of Mysore (SBM), State Bank of Patiala (SBP), State Bank of Travancore (SBT), and Bharatiya Mahila Bank (BMB) merged with SBI.
While account holders were given one year’s time to update the details of their new account with fund houses, R&T agents have been updating their systems and processes to ensure seamless transaction after March 31, 2018. However, many investors with such an account are yet to submit their new cheques to continue with their investments, a senior R&T agent official said.
To continue with existing investments and make any fresh investments, distributors will have to ensure that they submit a separate cheque from clients holding accounts with an SBI subsidiary bank, before March 31, 2018.
In a communication sent to distributors, CAMS said, “This is to intimate that due to the merger of State Bank subsidiaries with SBI, there is no effect on the investor. CAMS is updating the IFSC codes of these subsidiary banks and all the front offices will be accepting the cheques of these subsidiary banks till March 26, 2018.”
A senior official of Karvy Computershare, requesting anonymity, told Cafemutual that they have already updated their systems and processes with new IFSC codes of these banks. However, they would require new cheques to continue with the SIPs or execute fresh lumpsum transaction from April 1, 2018. “Since SIP mandate takes a few days to get approved, distributors can send us new cheques latest by March 24, 2018 to avoid discontinuation of SIP,” the official said.
