From January 1, 2011, all categories of investors irrespective of amount of investment in Mutual Funds are required to comply with KYC norms under the Prevention of Money Laundering Act 2002 (PMLA) for carrying out the transactions such as new or additional purchase, switch transactions, new SIP registrations Change in Address and bank details.
Thus, with effect from 1st January 2011, any investor investing into mutual funds through the Investment Services Account would be required to be KYC compliant with CVL (CDSL Ventures Ltd) without which the transactions may be liable to be rejected by the respective mutual fund houses.
KYC is an acronym for 'Know your Client', a term commonly used for Client Identification Process This would be in the form of verification of identity and address, providing financial status, occupation and such other demographic information to CDSL Ventures Ltd. (CVL), a wholly owned subsidiary of Central Depository Services (India) Ltd. (CDSL).
KYC is just to get an Idea on are you a Legal Citizen of India making you eligible for investments. NRI’s are also required to complete the KYC requirements for eligibility to invest in Indian Markets.
The process of KYC is fairly simple all you need to do is download the single page form fill your Age, Address, DOB and occupation status. Provide valid proof for Identity as well as address and you are done with it. Below mentioned the link for downloading a KYC form.
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