In a letter sent to AMCs, AMFI has said that the mutual fund industry has 99 lakh folios without PAN as on May 31, 2019. Industry experts said that the number includes PAN exempted folios but such folios are not substantial.
In fact, SEBI has expressed concern over the large number of non-PAN folios. Following which, AMFI has drafted an action plan for the RTAs, AMCs and distributors to remediate non-PAN folios.
We spoke to RTAs to understand how distributors can help clients update their PAN.
While Karvy Fintech has introduced an online facility to help distributors and investors upload PAN online, CAMS would soon provide such a facility.
You can use Karvy Fintech’s new facility to upload PAN by clicking here. You will need to key in AMC name, folio number, investor name and PAN number of your clients. Once you key in these details, your client will be required to upload a scanned copy of self-attested PAN card. Karvy Fintech will verify the authenticity of the PAN by matching signature.
In case of joint accounts, all investors registered in a folio will have to upload their PAN separately.
Ravikumar Somasi, General Manager, Karvy Fintech said that there will be no one time password authentication to remediate non-PAN folios, as most of them were created several years ago. “We have kept things simple. A self-attested copy of PAN ensures that investor has authenticated it on his own and we will anyway validate PAN and match the signature before remediating a non-PAN folio.”
Currently, both CAMS and Karvy Fintech offer mailback reports to get status on PAN update of your clients. Distributors can download a list of folios where PAN is not available. This will help you get information on folios where you need to work.
A few fund houses have also sent written communication to distributors requesting them to update PAN and KYC of their clients.
Apart from this, an AMFI team headed by Kailash Kulkarni, Vice Chairman, AMFI and CEO, L&T Mutual Fund has requested SEBI to issue clarification to AMCs that PAN is mandatory for all types of transactions initiated by the investors, including redemption.
