The Securities and Exchange Board of India (SEBI) has released a circular via which it intends to make the Know Your Client (KYC) process a one-time affair for investors. It has said that an intermediary will perform the initial KYC of its clients and upload the details on the system of a KYC Registration Agency (KRA).
Post this initial verification, when the investor goes to a different intermediary for investment, the intermediary will verify and download the client’s details from the system of the KRA. This will thus eliminate the duplication of the KYC process once an investor has undergone the KYC process with a SEBI registered intermediary.
As of now, if an investor intends to have a business relationship with different intermediaries in the securities market, he has to repeat the KYC process as many number of times as the number of intermediaries he intends to have a business relationship with. To avoid this repetition, the regulator has developed a mechanism for centralization of the KYC records in the securities market.
For this purpose, SEBI has formulated and notified the KYC Registration Agency (KRA) Regulations, which cover the registration of KRAs, functions and responsibilities of the KRAs and intermediaries, code of conduct, data security, etc.