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AMCs are now a part of RBI's Account Aggregator system, which is a financial data-sharing framework built for investors and regulated financial entities.
SEBI gave its go-ahead to AMCs and depositories on Friday through a circular which includes a detailed guideline on how and what information they can share with account aggregators (AA).
The circular states that AMCs can share information with AAs only after taking the consent of investors.
"The FIPs (AMCs and depositories) in the securities markets shall share the 'Financial Information' pertaining to securities markets, through the AA only on receipt of a valid consent artefact from the customer through the Account Aggregator," the circular stated.
The regulator has asked AMCs to build required interface for receiving the consent, authenticating it and safely sharing the information with AAs through their RTAs.
"There shall be adequate safeguards built in IT systems of FIPs in the securities markets to ensure that it is protected against unauthorized access, alteration, destruction, disclosure or dissemination of records and data," the regulator said.
Further, AMCs will have to prominently display the names of account aggregators with whom they share data.
The inclusion of mutual funds in the AA ecosystem can impact the way RIAs service their clients as they will have access to a lot more information. Will MFDs also benefit from the development? Find out here.
