Click to play videoNew Delhi: Come February 1 and investments above Rs 50,000 will have to comply with new norms.
Mutual fund investors will now have to provide the following details:
- Photo identity proof
- Proof of residence
- Disclose financial status by disclosing their income bracket
- PAN card, not just the number
Association of Mutual Funds in India (AMFI) Chairman, AP Kurian says, "Under the Prevention of Money-Laundering Act, we have to do this. This is requirement under the law and we also accept it. We tried telling the Government that we are transacting through banks and we are taking PAN cards, so we should not be asked to do this, but the Government, in it's wisdom says no you will have to follow the new rules."
And that's not all! To simplify the process for investors, AMFI and Central Depository Services India (CDSL) Ventures Ltd. have signed a venture for an investor database.
So now, new investors have to provide their details and a PAN card to CDSL Ventures Ltd., which in turn will give details on request to the the various fund houses.
Though this comes at no cost to the investor, it requires additional effort to visit CDSL Ventures Ltd. centres to submit details.
The move may be in the larger interest of the investor, but it comes to fund houses at a price. While industry players favour it for a smooth functioning over the long-term, they fear investors may shy away in the near-term rather than complying with new norms.
And with initiatives like MIN having failed in the past, its success remains a big question.
(For updates you can share with your friends, follow IBNLive on Facebook, Twitter, Google+ and Pinterest)
More on IBNLive Right Now
TOP NEWS
MOST SHARED
PHOTOGALLERY
