Over 73% of KYC records validated, systems in place for remaining: KRAs

15% under KYC Registered status, 12% on hold as of March 31

Know-your-customer (KYC) registration agencies said on Wednesday that 73 per cent of the 108.3 million KYC records were validated as of March 31, 2024, and that the system was in place for the rest of the investors to validate their KYC.

The update comes amid several investors and mutual fund (MF) distributors voicing their issues and concerns around the new KYC norms, which bar investors with unvalidated KYC records from starting a new MF investment account in any fund house other than those where they are already invested.

On the Securities and Exchange Board of India’s direction, KYC registration agencies, or KRAs, put all the KYC records into three buckets — KYC Validated, KYC Registered/Verified, and KYC On Hold.

 

According to the release, 15 per cent of the records are under KYC Registered status, and the balance 12 per cent are under KYC On Hold status.

Investors whose KYC is on hold cannot transact in existing MF folios either.

The KRAs — CDSL Ventures, Computer Age Management Services, National Stock Exchange, and Karvy — said they have dedicated help desks and call centres where investors can call for any assistance or guidance.

“KRAs have also been sending communications to intermediaries to update them about progress on the KYC status verification exercise. KRAs also send communication to investors on any access/modification to their KYC record,” they observed.

MFs have also stepped up efforts, both at the association and fund house level, to educate investors on the KYC issue and help investors not having a validated KYC.

The Association of Mutual Funds in India (Amfi) on Tuesday released an explainer on the KYC issue and listed the remedial measures.

Edelweiss MF on Wednesday said it has set up a help desk for assistance.

The issue surfaced after April 1 as MFs were restricted from onboarding investors whose KYC was not done using officially valid documents like Aadhaar. These investors have to do their KYC again using a valid document to be able to invest in an MF scheme other than those offered by fund houses where they are already invested.

According to Amfi, investors can validate their KYC through any of the MF websites. They can also take the offline route by submitting the KYC form to any of the asset management companies or registrar and transfer agent offices.