In its latest best practices circular, AMFI has asked AMCs to gather the missing KYC information from investors and ensure that all investors have undergone IPV (in-person verification). IPV means that information provided in the KYC form has to be verified in-person by distributors.
Earlier, AMFI had asked distributors to collect missing KYC information from investors who had undergone KYC registration before January 1, 2012. The missing KYC details includes (for individual investors) name of father/spouse, marital status, nationality and gross annual income/latest net worth etc. In addition, IPV was made mandatory from 2012. Apart from distributors, IPV can be done by employees of AMCs, R&Ts and authorized officials of commercial banks (only in case of direct applications).
So far, AMCs were accepting transactions even if IPV was not done by distributors. From January 2016, AMCs will not accept incomplete applications (where KYC is done and IPV is incomplete). For ease of doing IPV, SEBI has allowed distributors to perform IPV through web camera.
SIP and STP mandates already registered till December 2015 are exempted from this requirement.
AMFI has urged distributors to make sustained efforts to obtain missing KYC information and complete IPV and updated the same in KYC Registration Agency (KRA) records till December 2015.
AMFI has directed AMCs to reject applications from November 2015 if KYC status is ‘deactivated’, ‘not available’ and ‘rejected’. If investors KYC status is ‘on hold’ then AMCs and RTAs need to intimate investors and get it rectified. From November 1, 2015, AMCs will reject all purchase and switch transactions if the missing information is not complete.
From January 01, 2016, AMCs will reject all purchases and switch transactions if the missing KYC information is not provided and IPV is not completed.
Distributors have to make sure that they have performed IPV till December 31st and update missing KYC information by 31st October 2015.
