KYC or “Know Your Customer” is a process of customer identification, carried out at the time of opening an account with any financial institution in India. Investors can complete online KYC for mutual funds while they can also go for the offline route.
In the KYC process, the investor’s identity and address are verified with the help of relevant documents like a PAN card and address proof such as an Aadhaar Card, Voter ID, Driving License, etc.
To invest in any of the different types of mutual funds in India, you must be KYC-compliant. The Securities and Exchange Board of India (SEBI) has stipulated several obligations under the Prevention of Money Laundering Act (2002) for financial intermediaries and financial institutions including Mutual Funds to do background checks on their customers.
The Process of Mutual Fund KYC
Offline and online are the two ways to go through the process of getting mutual fund KYC.
1. Offline KYC for Mutual Funds
Offline KYC with KRA
The mutual fund industry has given authorization to CDSI Ventures Ltd. to do the KYC process for its investors. CVL looks after customer profiling and record keeping to fulfill the KYC standards.
- First, the KYC application can be downloaded from the website of CDSL.
- After filling in the details, copies of your attested photograph, PAN card, ID proof, and address proof are to be attached.
- All these together with the application form are to be submitted to the mutual fund house or the office of the intermediary that has been selected to invest with.
Offline KYC with an investment platform or intermediary
If you are thinking of investing with an investment platform or a particular fund house, they will give you a KYC registration form. The investment platform or the fund house will be registered with a KYC Registration Agency or KRA.
After you fill out the form, the company will create your KYC for your PAN number.
2. Online KYC for Mutual Funds
Online KYC with KRA
Regarding online KYC, the process has to be done individually with the intermediary or the mutual fund house that you have selected to invest with.
Unlike offline KYC, online KYC will have to be done by filling out the form online and uploading all the documents needed. It eases you from the burdensome process of physically appearing at the office only to get the authentication done.
- Log on to any KRA website.
- Make an account and fill out the online form with all the details.
- You need to give your registered mobile number, PAN Card, and other details of identification.
- Self-attested documents need to be uploaded online.
After the completion of the process of KYC through a KRA offline or online, you will be given a KYC identification number that you can share with your selected investment platform and you can start investing.
Aadhaar based KYC
While it is no longer compulsory to provide Aadhaar for KYC, investors still choose to go the Aadhaar route to fulfill their KYC standards. Most investment platforms and fund houses provide an Aadhaar-based KYC scheme.
What are the documents you need?
As you establish authenticity on diverse levels, your name, photograph, income proof, and residential address are to be verified. For this reason, the following documents are needed:
- PAN Card: For your mutual fund KYC, your PAN number is compulsory.
- Identity and address proof: In this respect, any document like your passport, Aadhaar card, or driver’s license can be used. Your electricity bills can also be used as address proof provided you produce a separate document for your ID proof.
Checking mutual fund KYC status
The following steps need to be followed if you want to check the KYC status for mutual fund investments.
- Go to cvlkra.com
- Enter your PAN number along with other details
- Now you can see if you had a valid KYC process.
To conclude, to have a trouble-free investing experience, it is necessary to go through the important process of KYC in case you would like to take part in transactions with any financial institution. You should ensure to get all documents required for KYC ready with you before you advance.