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All about KYC

By Nivesh Gyan   18 September

Category: General

All About KYC

What is KYC?

KYC stands for Know Your Customer. It means that an investor is required to submit his/her identity details with the mutual fund companies.

According to the Prevention of Money laundering Act, 2002 (PMLA), Asset Management Companies (AMCs) are required to formulate rules and implement a customer identification programme.

I want to invest in mutual funds. Is KYC mandatory?

Yes, to invest in mutual funds, complying with KYC norms is mandatory.

How can I get my KYC done?

There are 3 ways:

  • Physical KYC
  • OTP-based
  • Biometric KYC
Physical KYC OTP-based KYC Biometric KYC
Available for individual as well as non-individual investors Available for only individual investors with single mode of holding Available for only individual investors with single mode of holding
No limit on the investment value Sebi currently permits investment of Rs 50,000 each financial year per mutual fund No limit on the investment value
Takes 1-2 working days Instant Instant
Involves paperwork Paperless Paperless

Physical KYC

  • You can download the form from http://portal.amfiindia.com/spages/CKYC-KRA-KYC-FormforIndividuals.pdf. The form is also available with all the AMCs or the RTA (Registered Transfer Agent) like CAMS, Karvy, or Sundaram BNP Paribas Fund Services and Franklin Templeton, you are dealing with.
  • Fill up the form, and provide the self-attested copies of the following documents:
    • Identity proof
    • Address Proof
    • PAN Card
    • Photograph
    • Aadhaar Card
  • You also need to carry originals for In-person verification.
  • You can submit the form at the AMC with which you are making an investment or the RTA. On submission of the form, you will receive the KYC acknowledgement and your KYC will be done in 1-2 working days.

OTP-based KYC

Pre-requisite for OTP-based KYC: The mobile number must be linked with Aadhaar.

Your Aadhaar and registered mobile number will be verified with the Aadhaar database of the UIDAI. Upon successful verification, the screen will display that you are OTP-based KYC verified and can start transacting in mutual funds.

Biometric KYC

  • It is the simplest way to get your KYC done.
  • A finger print scanning device will be plugged into the phone or tab of the agent/mutual fund distributor/AMC you are dealing with.
  • The KYC app will automatically detect the plugged-in device and ask for a few details like PAN Card number, Aadhaar card number, Mother’s name etc.
  • You will then scan your finger print via the device and a validation will be carried out by UIDAI.
  • Post this validation, a few more details will be captured.

That’s it. Your data is submitted to the KYC authorities for completion of the process and you instantly become KYC compliant.

How can I check my KYC status?

Visit www.cvlkra.com, click on the KYC enquiry tab and enter your PAN Number—your KYC status will be displayed and if you do not see any information, it means that you are not KYC compliant yet.

or

Visit www.camskra.com, enter your Aadhaar number— your KYC status will be displayed.

Do I need to pay for KYC?

No, the KYC process is free for the investors.

Do I need to get KYC done every time I invest?

No, KYC is a one-time exercise.