The Securities and Exchange Board of India (Sebi) on Friday came out with guidelines in pursuance of the Sebi?s Know Your Client KYC Registration Agency (KRA) Regulations. Sebi in its circular stated that the KRA system shall be applicable for all new client accounts opened from January 1, 2012.

On December 2, Sebi had come out with the regulations for uniform (KRA). The move would benefit investors as it would save them the trouble of repeating the KYC process while investing in various financial products. The regulator has allowed stock exchanges, depositories or any other Self Regulatory Organisation (SRO) to form wholly-owned subsidiaries that could be registered as a KRA

Sebi on Friday, in its guidelines said, KRA shall send a letter to the client within 10 working days of the receipt of the initial/updated KYC documents from intermediary, confirming the details thereof and maintain the proof of dispatch. The intermediaries shall maintain electronic records of KYCs of clients and keeping physical records would not be necessary.

While it shall be mandatory for all the intermediaries addressed in this circular to carry out In-Person Verification IPV of their clients. In case of stock brokers, their sub-brokers or authorised persons (appointed by the stock brokers after getting approval from the concerned Stock Exchanges) can perform the IPV.

?In case of mutual funds, their asset management companies (AMCs) and the distributors who comply with the certification process of National Institute of Securities Market (NISM) or Association of Mutual Funds (Amfi) and have undergone the process of ?Know Your Distributor (KYD)?, can perform the IPV. However, in case of applications received by the mutual funds directly from the clients (i.e. not through any distributor), they may also rely upon the IPV performed by the scheduled commercial banks,? said SEBI in its circular.

The KRA system shall be applicable for all new client accounts opened from January 1, 2012. Only for the client accounts opened between Jan 1 and Jan 31, 2012, the intermediaries may upload the KYC data on the KRA system and send the relevant KYC documents to KRA, by February 15, 2012. However, for client accounts opened from February 1, 2011, the intermediaries shall continue to follow the requirement of sending the same within 10 working days, as mentioned above.