The Association of Mutual Funds in India (AMFI) is planning know-your-distributor (KYD) norms in line with the existing know-your-customer (KYC) details, a source close to the development told Value Research.
According to the source, who is member of an AMFI committee, the decision on the same would most likely be taken in an AMFI meeting slated later today (August 11). When contacted AMFI Chairman A P Kurian said the draft of the norms would be finalised in another couple of days. He refused to divulge further details.
Under the KYD norms, details such as address, ARN (AMFI registered numbers) etc would be sought from a distributor and a data base of all these details would be maintained by an AMFI body.
As per the KYC norms, an investor has to provide the fund house proof of their identity and address, PAN card and photographs. KYC formalities are required to be completed for all unit holders for any investment (whether new or additional purchase) of Rs 50,000 or more in mutual funds. For the convenience of investors, all mutual funds have made special arrangements with CDSL Ventures Ltd (CVL), a wholly owned subsidiary of Central Depository Services (CDSL).
A mutual fund distributor told Value Research that KYD norms would improve servicing of clients by distributors. "In many cases, independent financial advisors and individual distributors would simply sell the products and never show their face again to the clients. Now, with a comprehensive data base on distributors, once can trace such distributors," he said.
Source:http://new.valueresearchonline.com/story/h2_storyView.asp?str=14959
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