SEBI issues circular on simplified norms for processing investor’s service request by RTAs and norms for furnishing PAN and KYC details

On November 03, 2021, SEBI has issued simplified norms for processing investor’s service request by RTAs and norms for furnishing PAN, KYC details and Nomination. The new framework will come into effect from January 1, 2022.

1. As an on-going measure to enhance the ease of doing business for investors in the securities market, the following norms, with respect to the captioned matter, shall be applicable;

  • Common and simplified norms for processing any service request from the holder, pertaining to the captioned items, by the RTAs;
  • Electronic interface for processing investor’s queries, complaints and service request;
  • Mandatory furnishing of PAN, KYC details and Nomination by holders of physical securities;
  • Freezing of folios without valid PAN, KYC details and Nomination;
  • Compulsory linking of PAN and Aadhaar by all holders of physical securities.

2. Standardized, simplified and common norms for processing investor service request: Investors holding securities in physical mode interface with the RTAs.

  • Minor mismatch in signature: In case of minor mismatch in the signature of the securities holder as available in the folio of the RTA and the present signature, the RTA, while processing the service request, shall intimate the holder by Speed post about the minor mis-match in signature, providing timeline of 15 days for raising objection, if any. In the absence of any objection, the service request shall be processed.
  • Major mismatch in signature or Signature Card is not available: In case of major mismatch in the signature of the holder as available in the folio of the RTA and the present signature or if the same is not available with the RTA, then the holder / claimant shall furnish original cancelled cheque and banker’s attestation of the signature as per Form ISR-2.
  • Mismatch in name: For minor mismatch in name between any two set of documents presented by holder / claimant for any service request, the RTA shall additionally obtain any one of the following documents, explaining the difference in names, namely: Unique Identification Number (UID) (Aadhaar); Valid Passport; Driving license; PAN card with photograph; Identity card / document with applicant’s Photo, issued by any of the following: Central / State Government and its Departments, Statutory / Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, Public Financial Institutions; Marriage certificate; Divorce decree.
  • Furnishing of PAN: PAN is mandatory for all transactions in securities market as per circular dated April 27, 2007 and it is also one of the document for proof of identity. SEBI registered RTAs have been authorized as an eligible entity by the ITD to verify PANs through its ‘Online PAN Bulk Verification’ (PBV) facility.
  • Documents for Proof of Address: The RTA shall obtain any one of the following documents from the holder / claimant, if the address is not available in the folio or for processing the request for its change, namely: Valid Passport / Registered Lease or Sale Agreement of Residence / Driving License / Flat Maintenance bill; Utility bills like Telephone Bill (only land line), Electricity bill or Gas bill – Not more than 3 months old; Identity card / document with address, issued by any of the following: Central/State Government and its Departments, Statutory / Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, Public Financial Institutions; For FII / sub account, Power of Attorney given by FII / sub-account to the Custodians (which are duly notarized and / or apostilled or consularised) that gives the registered address should be taken; The proof of address in the name of the spouse; Client Master List (CML) of the Demat Account of the holder / claimant, provided by the Depository Participant.
  • Self-attestation to replace Affidavits, Attestation / Notarization
  • Indemnity
  • Form for availing investor services
  • KYC details across all folios of the holder, maintained by the RTA: RTAs shall update the PAN and KYC details across all the folios of the holder managed by it, upon specific authorization for the same from the holder, as provided in Form ISR-1.
  • Mode for providing documents / details by investors:The RTA shall enable the holder / claimant to provide the aforesaid document/details by any one of the following mode;

    a) through ‘In Person Verification’ (IPV): the authorized person of the RTA shall verify the original documents furnished by the investor and retain copy(ies) with IPV stamping with date and initials

    b) through hard copies which are self-attested and dated

    c) through electronic mode with e-sign, as elaborated subsequently.

  • Timelines for registering of / up-dation of / change in PAN, KYC and nomination: RTAs shall process any of the aforesaid request from the holder, within seven working days of receipt of the complete documents / details.
  • Display of contact details of RTAs
  • All objections by RTA in once instance.

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