In the last few years, mutual funds have become the preferred mode of investment for retail investors. However, from 1st April 2024, some investors have been facing challenges in making new investments with new AMCs, and some investors have been facing challenges in redemptions due to KYC changes.
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In this article, we will understand the new KYC changes applicable from 1st April 2024 and what you should do to ensure smooth investments/redemptions.
KYC changes from 1st April 2024
If you are facing any challenges with new mutual fund investments or redemptions, you should check your KYC status. You can check your KYC status with a KRA like CVL KRA, NDML KRA, CAMS KRA, DOTEX KRA, KARVY KRA, etc. Based on the KRA status, here is the action you need to take.
As per the above table, if your KYC status is anything other than “KYC Validated”, you should take steps to get the status updated to “KYC Validated”. In some cases (status – KYC Registered), you can continue transacting with the existing fund house/s. However, to start investments with new fund houses, you will have to get the status updated to “KYC Validated” to continue transacting seamlessly without having to submit KYC documents again.
How to get the KYC status updated?
The first step is to check the current KYC status. Visit your KRA website as mentioned below, enter your PAN details and submit. Your KYC status with other details will be displayed.
Following are the links for the various KRAs.
To invest seamlessly with any AMC, your KYC status should be “KYC Validated”. For this, you need to have the following:
PAN should be validated with the Income Tax Department (ITD) database
Aadhaar should be validated with the UIDAI database
PAN and Aadhaar should be linked successfully or should not be applicable
Email and/or mobile number should be validated
If your KYC status is not “KYC Validated”, you can get it updated by submitting a modification request on the mutual fund house website or the KRA website. The other option is to download the form or visit the investor service centre of the AMC / KRA and submit the duly filled form with the requisite documents.
If your KYC status is anything other than “KYC Validated”, you will have to complete the KYC process using Aadhaar as OVD through online mode. When you enter your Aadhaar number, the details will be verified online with the UIDAI database. On verification, the status will change to “KYC Validated”.
Once the status changes to “KYC Validated”, you can make new investments with any AMC and continue with your existing investments seamlessly.
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KYC validation: Key to seamless investing
If your KYC status is not validated, it is recommended that you get it validated by using your Aadhaar as OVD through online mode. It is a one-time process, and once completed, you will be able to invest seamlessly across AMCs. Continuing hassle-free investments is the key to achieving financial goals and financial freedom in the long run.
