KNOW YOUR CLIENT (KYC) and its importance with regards to Mutual fund investment

KYC is an acronym for “Know your Client”, a term commonly used for Client Identification Process. SEBI has prescribed certain requirements relating to KYC norms for Financial Institutions and Financial Intermediaries including Mutual Funds to ‘know’ their clients. This would be in the form of verification of identity and address, financial status, occupation and other such personal information. An applicant must be KYC compliant while investing with any SEBI registered Mutual Fund.- Know Your Client (KYC) requirement under Prevention of Money Laundering Act, 2002.
Individual investors will have to produce their Proof of identity (Photo PAN card copy or PAN card copy) and Proof of Address (any valid documents listed in section B of the KYC Application Form for Individuals).

Non–Individual Investors will have to produce certain documents pertaining to the constitution/registration to fulfill the KYC process. A list of Mandatory Certified documents to be submitted can be found in section C of the KYC application form for Non-Individual Investors.
The Association of Mutual Funds of India (AMFI) has facilitated a centralised platform through CDSL Ventures Limited (“CVL”), a wholly owned subsidiary of Central Depository Services (India) Limited. They will carry out the KYC procedure on behalf of all Mutual Funds. CVL, through its Points of Service (POS) will accept KYC Application Forms, verify documents and provide the KYC Acknowledgement (across the counter on a ‘best effort’ basis). The list of POS will be displayed on the websites of Mutual Funds, CVL and AMFI ( and respectively). Once the KYC is duly completed in all regards, the investor needs to produce a copy of the acknowledgement when investing for the first time with Mutual Fund. There is no need to repeat the KYC process individually for each mutual fund.
A KYC Application Form has been designed for Individual and Non-Individual Investors separately. These forms are available on the website of mutual funds, AMFI and Central Depository Services (India) Limited (CVL). You may also approach your distributor for a form. It is important to read the instructions printed on the KYC Application Form while filling up the form.
No. If the investor is not in a position to visit POS personally, the KYC Application Form along with the necessary documents (including originals, if the copies are not attested) can be sent through the distributor or representative, who can arrange to complete the KYC process and obtain the KYC Acknowledgement through any of the POS.
Currently, all investors (Individuals or Non-Individuals) who wish to make an investment of Rs. 50,000 or above in a mutual fund scheme will be required to complete the KYC process. This would also apply to new Systematic Investment Plan (SIP) registrations on or after 01 February 2008, if each SIP installment is of a value greater than or equal to Rs. 50,000. Please find a list of personnel who are required to be KYC compliant:

Joint Holders:Joint holders (including first, second and third if any) are required to be individually KYC compliant before they can invest with any Mutual Fund. E.g. in case of three joint holders, all holders need to be KYC compliant and copies of each holder’s KYC Acknowledgement must be attached to the investment application form with any Mutual Fund.

Minors:In case of investments in respect of a minor, the Guardian should be KYC compliant and attach their KYC Acknowledgement while investing in the name of the minor. The minor, on reaching 18 years of age, should immediately apply for KYC compliance in his/her own capacity and intimate the concerned Mutual Fund(s), in order to be able to transact further in his/her own capacity.

Power of Attorney (POA) Holder:Investors desirous of investing through a POA must note that the KYC compliance requirements are mandatory for both the POA issuer (i.e. Investor) and the Attorney (i.e. the holder of POA), both of whom should be KYC compliant in their independent capacity and attach their respective KYC Acknowledgements while investing.

For transmission:(in case of death of the unit holder): If the deceased is the sole applicant, the claimant should submit his/her KYC Acknowledgement in the request along with the other relevant documents to effect the transmission in his/her favour. For transfer of units; transferee/s should submit his/her/their KYC Acknowledgement in the request along with the other relevant documents to affect the transfer in his/her/their favour.
Investors must attach their KYC Acknowledgement along with the Investment Application Form(s)/Transaction Slip(s) while investing for the first time in the A/c folio in a mutual fund. Applications Forms/ Transaction Slips not accompanied by KYC Acknowledgement are liable to be rejected by the Mutual Fund. If you do not obtain a KYC Acknowledgement, you will not be able to invest Rs. 50,000 or more in a mutual fund.
No. Once the KYC Acknowledgement is obtained and informed to a Mutual Fund, it will be registered against the folio and quoted in all future account statements. The same will exist in perpetuity, unless cancelled by CVL.
You can inform the Mutual Fund to update the KYC Acknowledgement against all the folios/accounts you have with it. However, each of the holders in these folios/accounts should be KYC Compliant.
The soft copy of these KYC forms will be made available on the website of all mutual funds, AMFI and Central Depository Services (India) Limited (CVL) ( and respectively). You may also approach your distributor for a form. The same duly completed along with the necessary attested documents can be submitted at the POS or mailed to your representative or Distributor who can complete the KYC formalities for you.
Yes. In addition to the certified true copy of the passport; a certified true copy of the overseas address and permanent address will also be required. If any of the documents (including attestations/certifications) towards proof of identity or address is in a foreign language, they have to be translated to English for submission. The documents can be attested, by the Consulate office or overseas branches of scheduled commercial banks registered in India.
Upon a minor attaining the age of majority (i.e. on completing 18 years of age), he/she must be KYC Compliant and have KYC Acknowledgement of their own. The same should be informed to the Mutual Fund where he/she holds an investment, along with other details such as the Bank Details, Signature, etc. as per the present requirements of such Mutual Fund.
You should intimate your change of Name/Address/Status/Signature etc. to any convenient POS. You need to quote your PAN and submit proof (in case of a new address). You should provide for at least 10 days for the change of address to take effect with all the Mutual Funds with whom you are invested. Please note that you should not write to the Mutual Fund or its Registrar for the change of address (unless as a designated POS). The specified form can be obtained from the AMFI/Mutual Fund/CVL website. All details of the holders in the Mutual Fund records will be replaced by the address details available in the CVL record.
Once the investor is KYC compliant, it will be required to intimate his KYC details to all the Mutual Funds with whom it has investments by quoting the folio numbers. The same will be updated in the records of the Mutual Fund.

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