KYC is must for every mutual fund investor

Mutual Funds | admin | July 15, 2011 at 7:58 am

The Know Your Client (KYC) process is mandated by the Prevention of Money Laundering Act, 2002, and requires institutions engaged in the development and distribution of financial products and services to verify and maintain records of all their clients.

The KYC process for individuals involves verifying the identity and address. In the case of mutual funds, investors have to complete the KYC formalities with an identified service provider, CDSL Ventures. This is a one-time exercise and applies to investments in all mutual funds registered by Sebi. The application for buying units for the first time must be accompanied by the KYC acknowledgement.

The existing investors are also required to complete the procedure and provide proof of having done so before making additional investments.

Form: The application for the KYC process has to be filled as per the prescribed format. This form can be downloaded from http://tinyurl.com/5ugpkq7.

Information: The personal details of the individual and additional information, such as occupation and income level, have to be provided.

Proof required: The information provided in the application has to be submitted along with identity proof (PAN card), and address proof (passport, driving licence, etc).

Submission: The application has to be submitted at designated points of presence of CDSL Ventures. The list can be downloaded from http://tinyurl.com/3mxmv2h.

Points to note

Pre-requisite: Investments in mutual fund can be made only after receiving the KYC acknowledgement from the concerned point of presence or investor service centre.

Verification: The original documents provided as proof of identity and address are verified at the time of accepting the application and copies are appended to the application.

Validity of address proof: If the document provided as address proof has a validity date, it should not have expired at the time of presentation.

Source: Economic Times

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