New Delhi: Stock Market regulator Securities and Exchange Board of India (Sebi) has recently relaxed Know Your Customer (KYC) norms for investments in mutual fund schemes by Non-Resident Indians (NRIs). Recently, many NRI mutual fund investors faced a lot of issues regarding KYC status of their mutual fund folios. They faced such issues even during redemption of units. Consequently, in many cases, they couldn’t redeem at all and had to absorb losses. Many such investors always faced messages and notifications regarding the same whenever they opened their folios. Sebi’s relaxations will provide relief to such investors.
Sebi’s new KYC rules for NRI MF Investors
Sebi introduced new KYC rules for mutual fund schemes of NRIs effective April 1, 2024. However, the market regulator relaxed those rules till April 30, 2025. The market watchdog has given NRIs time till April 30, 2025 to abide by the new KYC rules pertaining to their mutual fund investment in India.
Sebi introduced the following two new rules for updating of KYC status of NRI mutual fund investors:
MF Folio’s ‘KYC registered’ status not enough
Sebi made it mandatory for NRIs who want to invest in new mutual fund schemes in India to get KYC status of their folios upgraded from ‘KYC registered’ to ‘KYC validated’ with submission of additional KYC documents.
What is the first relaxation?
Now, the market watchdog has allowed such investors to invest in new schemes even with ‘KYC registered’ status till April 30, 2025.
2. Email, phone number required to upgrade status to ‘KYC validated’
From April 1, 2024, NRI investors were required to provide both phone numbers and email to upgrade the KYC status of their mutual fund folios from ‘KYC registered’ to ‘KYC Validated’. But some of these investors had overseas phone numbers. So, they faced problems in updation of KYC details with overseas numbers.
What is the second relaxation?
Now, Sebi has allowed such investors to validate their KYC via email. This means, now, they just need to provide email and phone number has been made optional in getting KYC status of their folios upgraded from ‘KYC registered’ to ‘KYC Validated.’
But NRI investors should watchout, the market watchdog has given these two relaxations only till April 30, 2025. After that, if their folio’s KYC status doesn’t show as ‘KYC validated,’ then, they will not be able to invest in both new and existing mutual fund schemes.
Capital market regulator Sebi has relaxed KYC norms for Non Resident Indians who invest in mutual funds in India. The new KYC norms were earlier effective from April 1, 2024. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
