The new KYC changes, which will come into effect from April 1, 2024, are important for investors to understand to ensure that future and existing investments are not hindered.
The new rules mean investors with verified or registered KYC status can continue to trade with their existing mutual funds and brokers without any restrictions. However, KYC is considered incomplete until the required information is verified. Therefore, KYC remains pending and these investors must complete a verification process if they attempt to transact with a new broker or asset management company (AMC). Once completed, all future transactions require no further verification, making KYC completely portable.
KYC processes are critical to verifying customer identity and assessing the risks associated with financial transactions. While traditional KYC involves separate verification steps performed by each financial institution separately, integrated KYC provides an integrated approach and streamlines the verification process across multiple institutions.
Radhika Gupta, MD and CEO of Edelweiss Mutual Fund, tweeted on Friday: “KYC is a problem that desperately needs fixing as of yesterday. Aadhaar and the world’s best digital public infrastructure. This also seems very doable in a world where there is a strange new rule from KRA that allows KYC-registered customers to invest in funds with a folio, unless they obtain a Validated tag. You cannot invest in new mutual funds. This puts new midfield players at a huge disadvantage. People having to verify and abide by these rules over and over again only increases the cost of doing business when they should be focusing on expanding their market. We hope that this issue will be resolved conclusively soon if we aim to bring MF into every home. . ”
So how can you check and verify your KYC status?
There are multiple KYC statuses depending on the documents you submit at the time of application. If your KYC status shows as verified, it means you have submitted your Aadhaar or completed it online. This verified KYC status allows him to invest in AMC without any further action unless there are any specific changes to his profile information.
Abdulla Chaudhary, Chief Investor Services, Edelweiss Mutual Fund, explains in a video on Twitter: To invest in a new AMC if the status is other than verified, such as certified or registered. Need to change status. Fortunately, if your KYC status is verified or registered, you do not need to make any changes to continue investing in your existing AMC investments. Change requirements only arise if you invest in a new AMC.
