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Many of your clients’ KYC status can be moved from ‘On hold’ to ‘Registered’ status by May 31.
In a major relief to the Rs.57 lakh crore MF industry, the KYC Registration Agencies (KRAs) have confirmed that they will revalidate KYC status of all mutual fund clients till May 31, 2024.
According to the new KYC norms, KRAs will move KYC status of investors having ‘On hold’ status to ‘Registered’ status if either email id or mobile number is validated.
However, if any one of email id or mobile number cannot be validated, the KYC status will continue to be on ‘On hold’ status.
In an FAQ, CVL KRA said, “Status of all records put on hold due to non-validation of email, mobile or both at KRAs will be checked and KYC records where either mobile is validated but email isn’t and where email is validated but mobile isn’t will be changed from On Hold status to KYC Registered status irrespective of any KYC type and any OVD (including deemed OVD) for all individual category of investors.”
“In case of KYC records where only email is uploaded or only mobile is uploaded and these aren’t validated will continue to be retained in On Hold status,” it added.
This suggests that SEBI has done away with the requirement of both email id and mobile number to invest in mutual funds. Now, investors can invest in mutual funds either by quoting email id or mobile number for doing KYC. This will help many NRIs who do not have Indian SIM cards and senior citizen investors many of who do not have email id.
Please note that mobile number is compulsory for doing online KYC.
Further, investors with ‘On hold’ KYC status due to non- linking of Aadhaar and PAN will now be moved to KYC ‘registered’ status, clarified KRAs.
If a client status moves from ‘On hold’ to ‘Registered’ status, he/she can redeem their money or invest in existing mutual fund companies. However, they cannot invest in schemes of a new mutual fund company until they do re-KYC and get KYC ‘Validated’ status.
In addition, NRIs having KYC ‘Registered’ status are now exempted from doing re-KYC to invest in a new fund house till April 30, 2025.
CVL said, “SEBI registered intermediaries (SRIs) may note that KYC records uploaded and to be uploaded under category Non Resident Indian (NRI) and in KYC Registered status will be allowed to transact with their existing SRIs and will also be allowed to transact with new SRIs till April 30, 2025.”
