MAPIN deadline worries mutual funds

Mutual funds are a highly concerned lot with the deadline for obtaining unique identification number (UIN) by mutual fund investors drawing nearer.

The deadline is March 31, 2005 and from April 1 onwards no investor, wishing to transact Rs 1 lakh and more can do it without quoting his UIN.

The concern is that the investors would not be able to get the MAPIN identifications on time.

A delegation from the mutual fund sector did meet the Securities and Exchange Board of India chairman G N Bajpai last week in order to ask for an extension of the deadline by at least another three months.

But the securities chief is learnt to have told the industry officials that they would have to comply with the requirements according to the schedule put down.

But the mutual fund industry insiders said the logistics of the exercise was too huge and all the investors would not be able to make it on time.

V R Narasimhan, senior vice-president with National Securities Depository Ltd (NSDL), said, "The real problem is that we do not know the numbers concerned."

At present with 85 scanners for fingerprints, the throughput is around 4,000 fingerprints per day. This translates into a total number of 2.8 lakh fingerprints in the next 85 days left. However, there might be far more investors than this.

At present according to figures available with NSDL, 90,000 individuals have already obtained their UINs.

"Most people will troop in only during the last week. So with the number of scanners at our disposal it will not be possible to meet the demand," said Narasimhan.

So authorised points of service agents have been asked to procure more scanners. They have also been asked to enter into individual agreements with either brokers or mutual funds to further sub-let the process to them, thereby taking care of their own investors.

JM Mutual Fund and UTI Mutual Fund are some of the fund houses with whom such agreements have been forged.

A lot of irregularities are also creeping in, sources said. For instance, some intermediaries, thinking of the money to be made in the process, are creating a panic in the market about the obtaining of UINs and are seeking to get the mandate to issue MAPIN identities.

Narasimhan, however, said that NSDL is keeping a close watch on the quality of finger-printing which has to be of uniform standard. "We cannot compromise on that," he said.