Financial institutions use KYC to identify clients and acquire relevant information. KYC is a global phenomenon where the information collected is used to prevent identity theft, money laundering, fraud and terrorist financing.

How to comply with KYC

In India, (CVL), a subsidiary of Central Depository Services (India) Limited (CDSL), has been appointed by the mutual fund industry to perform KYC verification of investors in India.

You will need to submit the following required documents at a CVL Point of Service (POS) location:

1) Completed KYC application form

2) Proof of residency (utility bill, passport, letter from your employer or housing association, ration card, voter ID, or driver’s license).

3) BREAD card

If you submit your KYC request in person, you will need the original documents with you as well as the copies to be processed. The originals will be returned to you once their accuracy has been verified.

If you send the document through a courier service, the documents must be authenticated by a notary public, an official officer or a manager of an authorized commercial bank. KYC verification is a free process.

NRIs and PIOs must submit additional documentation along with the items listed above.

1) Certified true copy of passport

2) Certified true copy of foreign address

3) Permanent Address

4) For PIO: a certified true copy of the PIO card

All documents must be submitted in English and must be certified by the Consulate or foreign branches of commercial banks registered in India.

How to check your KYC verification status

Login to the CVL website. Enter your PAN card number and your status will be displayed as:

1) KYC in process

2) Full KYC

3) KYC refused

Once you are “KYC Compliant” through CVL, you will not be required to go through the process again. The KYC can be sent to the various mutual funds.

When investing in a mutual fund for the first time, a copy of the KYC Acknowledgment must be attached to the Investment Application/Transaction Slip Forms. Any application form that does not have a KYC Acknowledgment will be rejected.

KYC regulations have become a requirement to invest in any capital instrument. Even if you open a Demat account, you will need to comply with KYC. Linking KYC with their investments and the Pan card has made it very easy for the FIU to trace suspicious transactions.