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Listen to this articleStop Investment Delays! Ensure a Valid KYC Status for Mutual Funds (Updated April 2024)
As of April 1, 2024, a validated Mutual Fund KYC (Know Your Customer) status is mandatory for all investors. Wondering how to check and validate your KYC to seamlessly continue your mutual fund journey?
Table of Content:
- Understanding KYC: Why it Matters for Mutual Fund Investments
- What are OVDs for Mutual Fund KYC?
- How to Check Your Mutual Fund KYC Status Online (Quick & Easy!)
- Mutual Fund KYC Status Explained: Different Statuses and Their Implications
- What to Do Based on Your KYC Status?
- The Final Step: Prioritize Your KYC Status
Understanding KYC: Why it Matters for Mutual Fund Investments
We all know KYC is the first step towards investing in mutual funds. However, recent changes have highlighted the importance of a validated KYC status to ensure a smooth investment experience.
This recent requirement has emerged due to issues many investors have faced with their KYC status. Let’s delve into the background of KYC to understand why this has become important for all mutual fund investors.
Under the Prevention of Money-Laundering (Maintenance of Records) Rules, 2005, mutual fund investors who used non- Officially Valid Documents (OVDs) for KYC verification had to update their KYC by March 31, 2024.
What are OVDs for Mutual Fund KYC?
OVD stands for Officially Valid Documents used for KYC verification. OVDs are government-issued documents accepted for KYC verification. These include passports, driving licenses, Aadhaar cards, Voter IDs, NREGA job cards (signed by a State Government officer), National Population Register letters with address details, and any others notified by the Central Government.
Therefore, if you previously completed your KYC using these OVDs, you’ll need to update your KYC based on your PAN status by the deadline.
How to Check Your Mutual Fund KYC Status Online (Quick & Easy!)
Check Your Mutual Fund KYC Status Online in Minutes
Head to the CVL KRA website and navigate to the “KYC Inquiry” tab. Enter your PAN number, complete the human verification step, and click “Submit.” Your KYC status will be displayed on the screen.
Mutual Fund KYC Status Explained: Different Statuses and Their Implications
What types of KYC status will you find and what is the meaning of those?
Understanding Your KYC Status and Taking Action
When checking your KYC status online, you may encounter four different status types. Here’s what each of these statuses means:
i.) KYC Validated:
This indicates that your OVD data has been verified with the issuing authority, such as UIDAI. Your PAN-Aadhaar linking is completed, and your email and/or mobile number have also been validated.
ii.) KYC Registered:
This status means that while your Aadhaar OVD data couldn’t be verified with UIDAI, your PAN-Aadhaar linking is in place. Your email and/or mobile number has been validated.
iii.) KYC On Hold:
This indicates that the provided proof couldn’t be validated with the issuing authority, and your email and/or mobile number is yet to be validated.
iv.) On Hold:
This status is shown when there are issues with the contact details provided, regardless of the OVD validity.
What to Do Based on Your KYC Status?
Understanding KYC Status and Actions Needed:
1. Using Aadhaar for KYC – Resulting Status: KYC Validated
If your KYC is validated using Aadhaar, your status will display as “KYC Validated.” Investors can continue transactions with their existing funds and can also invest in new ones.
2. Physical Aadhaar for KYC – Resulting Status: KYC Registered
With a “KYC Registered” status, it means your Aadhaar isn’t verified but your contact details are. New investors with a new AMC should submit a scannable Aadhaar copy for validation. Existing investors with a “Registered/Validated” status as of March 31, 2024, face no changes.
3. Non-Aadhaar OVD Used (Allowed) – Resulting Status: KYC Registered
With a “KYC Registered” status, your proof couldn’t be validated but your email/mobile is. Existing mutual fund transactions remain unaffected. For new investments, complete the Aadhaar KYC online to avoid re-KYC.
4. Non-Aadhaar OVD Used (Allowed) – Resulting Status: KYC On Hold
For “KYC On Hold,” your proof isn’t validated, and your email/mobile is not verified. Update valid email/mobile details and complete Aadhaar KYC online to resolve.
5. Deemed OVDs (Not Allowed) – Resulting Status: KYC Registered
For “KYC Registered,” your proof isn’t validated, but your email/mobile is. Existing mutual fund transactions remain unaffected. For new investments, complete Aadhaar or allowed OVD KYC online to avoid re-KYC.
6. Deemed OVDs (Not Allowed) – Resulting Status: KYC On Hold
With “KYC On Hold,” all transactions are restricted. Submit valid email/mobile or PAN-Aadhaar link details to resolve. Complete Aadhaar KYC online to avoid further issues.
7. Non-OVDs Used – Resulting Status: On Hold
All transactions are restricted. Submit valid email/mobile or PAN-Aadhaar link details. Complete Aadhaar KYC online for resolution.
8. Invalid Contact Details – Resulting Status: On Hold
Transactions are restricted. Provide correct contact details before transacting. Complete Aadhaar KYC online for resolution.
The Final Step: Prioritize Your KYC Status
Check Your KYC Status Today and Invest with Confidence!
Verifying your KYC status is crucial for a seamless mutual fund investment experience. If your status isn’t “Validated,” we recommend updating it using your Aadhaar document and confirming your contact details. You can conveniently complete the re-KYC process online through some fund houses’ websites, like Quantum or UTI.
Remember, whether you do it online or offline, the updated KYC will reflect across all your mutual fund investments with various AMCs (Asset Management Companies). Ensure your PAN and Aadhaar are linked to avoid any roadblocks during the process.
By following these steps and prioritizing your KYC status, you can ensure a smooth and hassle-free experience when investing in mutual funds. You’ll benefit from a streamlined investment process, peace of mind knowing your KYC is compliant, and potentially access to a wider range of investment options.
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