Mutual funds industry body Amfi has sought more time from capital markets regulator Sebi for uploading KYC documents by fund houses with the central server for all the new accounts.
The Securities and Exchange Board of India (Sebi) had directed market intermediaries to upload KYC documents with C-KYCR for all new mutual funds accounts opened on and after August 1.
In a letter to Sebi late last month, Amfi has spelled out several challenges in implementing the C-KYC (Central Know Your Customer) from August 1, and asked the regulator to defer the time period to a later date on or after October 1, 2016 for the effective implementation of the new guidelines.
According to Amfi, mutual funds have to obtain a registration with CERSAI, that involves documentation, agreement, technology infrastructure set-up, testing and obtaining digital certificates.
CERSAI (Central Registry of Securitisation and Asset Reconstruction and Security Interest of India) has been authorised to take the task of a central KYC registry.
Additionally, Amfi said that C-KYC form and data are different from existing KYC form. Therefore, KYC form currently used in securities market needs to be revised to include additional information as required under C-KYC.
The industry body also said process of uploading data and scanned images of the supporting documents C-KYC system is also quite different as compared to the existing system.
“It will take some time for AMCs to modify the existing KYC forms, circulate the same, make the AMC employees, distributors and investors understand the nuances of the new/ additional fields and details in the form,” Association of mutual funds in India (Amfi) noted.
The industry body has also asked clarification with Securities and Exchange Board of India (Sebi) regarding existing KYC guidelines, FATCA form and In-Person Verification (IPV).
The regulator has asked for clarification regarding the process and timeliness and responsibility for porting the KYC data and documents from KRA database on to C-KYCR (Know Your Customer Registry) including guidelines on how the intermediaries should handle collecting additional KYC information required as per the C-KYC form in order to make the transition smooth.