Mutual Funds

How to do CKYC for Mutual Fund Investments

CKYC is known as Central Know Your Customer. This concept was introduced by the central government to keep the proper record and information of the investor in one place as it helps in tracing any fraudulent activity in the financial sector in a faster way. It is a central repository where all personal data of the customer will be saved and any financial activity like buying life insurance or investing in a mutual fund will become easier as the data will be under one platform. In this process, the investor need not go through the KYC process again and again which will save a lot of time for the investor as well as the financial entity involved. The data is accessible to all authorized financial authorities and can be viewed digitally.

Know your customer (KYC) is one of the basic practices accepted by all financial institutions. The introduction of CKYC further helps the government in keeping investment secure. The Central Registry of Securitisation Asset Reconstruction and Security Interest (CERSAI) is the supreme body that manages the CKYC registry.

Before and After CKYC

Let’s point out the major highlights of CKYC: 

  • CKYC is a 14 digit number that is connected with the client’s ID verification. 
  • The information is then securely put away in electronic format. 
  • All the documents go through verification by the issuer.
  • The changes made in KYC are updated directly and all the institutions are notified about the changes done by the investor.

How to register CKYC for Mutual Fund?

The CKYC Registry process is managed under the Central Registry of Securitization and Asset Reconstruction and Security Interest of India (CERSAI). The process of completing CKYC is not tedious. The investors are only required to submit the documents duly filled and attested as required. Then the documents are verified by the CERSAI and the 14 digits unique number is issued for future transactions. This unique number is saved digitally with all the information.

 Documents required for CKYC

  1. Duly filled CKYC form or KYC register Academy (KRA) application form with signatures.
  2. One identity proof (self-attested)
  3. Address proof (self-attested)
  4. One photograph

After the verification, the unique number is linked with the investor and the data can be accessed whenever required. CKYC has four types of accounts depending upon the documents submitted by the investor. They are explained below in brief: 

1. Normal Account: This is the basic account created by submitting the following documents by the customer identity proof it includes PAN Card, Aadhaar Card Voter Id Card, Driving License, Passport, or NREGA Job Card.

2. Small Account: This account is created by submitting personal documents  along with photograph.

3. OTP based Account: This account is created by submitting an Aadhaar card PDF from the file and a photograph which is enabled through OTP.

4. Simplified measure account: This account is created by submitting other valid documents (OVD) which are issued according to RBI Circular.

During the COVID pandemic, CKYC has also introduced Video KYC for mutual funds. New investors needed to get a central KYC and with a very simple process, it can be completed online. The investor after filling the form will get OTP and then the documents can be uploaded and further verified. 

Process

CKYC for Mutual Fund is a very simple process. First of all the customers have to get registered with KYC registry agency (KRA) and then the customer will get login credentials at their email. Currently there are 5 KRAs namely  CAMSKRA (by Cams), CDSL Ventures Limited (a division of CDSL), NSDL Database management Limited (a subsidiary of NSDL), DotEx International Limited (a unit of National Stock Agency),  and KARVY KRA(By Karvy) which are conducting verification and uploading the data to CKYC. After the approval by KRAs customers can upload documents and then the testing will occur in order to verify the details of the customer. When the details are verified the investor will get14-digit generated number which is linked to all of the investor’s data.

For existing mutual fund investors

Exisiting mutual fund investors do not need to undergo CKYC process. However, this might change in the future.

One can check if he/she is KYC verified or not by

  1. Downloading tarrakki app on your phone available on IOS and Android
  2. Get registered and enter Pan no.

If you are KYC verified you can start investing right away. If not, you can finish your KYC process sitting at home.

       B.     Visiting https://www.cvlkra.com/

  • Clicking on KYC inquiry at the top
  • Entering their PAN no. and other required details and click submit.

Once done, you will get to know if you are KYC verified or not.

CKYC Benefits

CKYC has numerous benefits. Firstly, it can be accessed from anywhere and by multiple parties which makes CKYC a hassle-free process. It saves time and energy as the update on is also notified and being a central repository it is a one time process.

The other major advantage is it will help in providing stability and will protect the market from any illegal financial activity.

Lastly CKYC for Mutual Fund helps in tracking all the investments in a better way as this single issued number can be used in multiple investments in mutual funds, insurance and stock markets

Conclusion

Nowadays, everyone wants to get things done in a few clicks. Initially the process of KYC was quite tedious and had to be done physically and multiple times. Now with CKYC, the process has become faster, easier, safer and has to be done only once before you start your financial journey.

Start paperless investing

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