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How to do KYC for Mutual Funds? Complete guide

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How to do KYC for Mutual Funds? Complete guide

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Think of the Know Your Customer or KYC for mutual fund process as introducing yourself to a new person. It can be awkward but usually leads to an overall pleasant experience. The only difference is, in KYC for mutual funds you fill out a detailed form that mentions your full name, address, contact information and nomination details. 

You need to mention this information in the KYC form to do your KYC for mutual funds. After filling out the details, you proceed toward your KYC verification for mutual funds. You can complete this process online or offline.

Financial institutions like investment brokerages and fund houses use your KYC information to identify you as a customer. To start investing and building wealth, you’ll need to complete the KYC process.

For investing in any type of mutual fund, your KYC process needs to be completed. Let’s learn about the mutual funds KYC process. 

Is doing KYC for mutual funds compulsory?

The KYC process was made mandatory to prevent the occurrence of fraudulent investments and money laundering. 

This process identifies you as a unique customer through your ten-digit PAN (Permanent Account Number). It also verifies your PAN with your original PAN card. 

Once your PAN is verified, the financial institution can check if you have defaulted on any payments in the past. 

How to do KYC for mutual funds offline?

You can complete your offline mutual fund KYC through the CDSL (Central Depository Services Ltd) website or an investment intermediary (platforms like banks and investment brokerages). 

The CDSL Ventures Limited or CVL is authorised to conduct the KYC norms and processes for mutual funds. 

Here are the steps for completing the mutual funds KYC offline: 

Step 1

Download and fill out the KYC form

You can download the KYC form from the CDSL’s website and fill out the details asked in the form. Fill in details like your PAN (Permanent Account Number), address, phone number, email address and other information correctly in the form. 

After filling out the form, it's a good practice to recheck all the details to make sure they are correct. 

Step 2

Keep your physical documents ready

Before you plan to visit the office of a mutual fund house or an intermediary, take some time to check if you are carrying all the required documents. 

The documents required for the offline KYC process are as follows: 

  • Duly-filled KYC form.
  • Passport-size photograph. 
  • Original documents and attested xerox copies for identity and address proof verification.
  • Visit the intermediary office

You should carry your duly filled KYC form along with the other documents to your chosen intermediary office and submit it. 

Step 3

Wait for verification. It will take around a week for the offline KYC process to be completed. 

Do you want to complete your KYC process faster? Then, you can choose to do online KYC for mutual funds.

How to do KYC for mutual funds online?

Your KYC to invest in mutual funds is done through the CKYC (Central KYC) process. You can invest in mutual funds through a fund house or an investment brokerage. However, you need to complete your KYC process with any one of them to start investing. 

With the CKYC, you do not have to do your KYC again to invest in mutual funds. This means that if you have completed your CKYC with a fund house, you can also invest in mutual funds through investment brokerages, and you don’t have to do your KYC again. The same applies to doing CKYC from a fund house. 

Once done, you need to update KYC for mutual funds online from time to time.

Here are the steps for completing KYC for mutual funds

1) Keep your documents ready

The sooner you complete your KYC compliance, the sooner you can start investing in mutual funds. Therefore, it is important to keep the following documents ready for verification:

2) Your PAN card will be required to prove your identity. You must have a PAN card for investing in mutual funds. For address proof, you can keep aside documents like your Aadhaar card, passport, driving licence, or your electricity bill. You have to provide the address proof where your given address matches the one mentioned on your address verification document. 

3) Search and keep the KYC form ready

4) Login to any KRA (KYC Registration Agency). You can find the web portal of any KRA by Googling “KYC Registration Agency India”. Now, select “Individual KYC”, enter your PAN and verify using Captcha. This will create your account with the KRA. After your KRA account is created, you can complete the KYC form.

5) Enter details like your name, address and other required information in the online KYC form. Recheck if you have entered all the important details in the form, like your bank registered mobile number and PAN. 

6) Verify with original documents. After entering your details in the KYC form, you can upload supporting documents for verification. These documents should be scanned files of the original PAN card and other address proof documents. 

The entire verification process for KYC can take around four to five days. 

Once you have completed your online KYC, the KRA will generate a unique KYC identification number. This KYC number will be common for any platform you choose for investing in mutual funds in India. 

You will also be notified through SMS on your registered mobile number once your KYC process is completed or if any further details are required for verification.

If there are any discrepancies in the verification documents and your details, your KYC process will not be completed. You must upload the correct documents for your KYC compliance to succeed. 

Once your KYC identification number is generated, you can login to your KRA website and update KYC online for mutual fund investing whenever required.

Summary of the KYC process steps

  • Keep your Identity and Address proof documents scanned.
  • Login to any KYC Registration Agency, also known as KRA. 
  • Fill in the details 
  • Verify the details by uploading scanned copies of original documents
  • Check if your KYC identification number is generated.

You can also complete your KYC online for mutual fund investing through an investment broker platform with these steps: 

  • Login to the mutual fund investment platform of your choice
  • Enter your PAN and Address 
  • Enter the Nomination Details for your Mutual Fund investments. This can ensure that your investments go to the right person if anything unfortunate happens to you. 
  • Upload scanned original documents for verification of your provided details.

What are the benefits of doing KYC for mutual funds online? 

There are two major advantages of doing the mutual funds KYC process online. 

  • Quick and paperless

Completing your KYC for investing in mutual funds can be quicker online. You can furnish the required details immediately without visiting a physical office. You only need to upload the scanned original documents for online KYC, making the process paperless. 

  • Complete KYC anytime and anywhere

Since you do not have to visit any branch of a bank or financial institution, you can complete the online KYC process anytime and anywhere. 

Summing up

You cannot invest in any mutual funds without completing your KYC verification. 

The process for completing your KYC online is quick, paperless and simple. Once you have filled out the online KYC form, you need to upload the scanned copy of the original documents for verification. If your document verification is successful, your mutual funds KYC process will be complete, and you can start investing in the mutual fund schemes of your choice. 

Frequently Asked Questions

1)Can the KYC process for mutual funds be done online?

KYC for mutual funds can be done online through the KRA (KYC Registration Agency) website or a mutual fund investment portal. Once your KYC verification is successful, you can invest through any mutual fund investment platform with the same KYC identification. 

2)How much time does it take to complete the KYC process for mutual funds?

The online KYC process for mutual fund investing takes around four to five days to be completed, whereas the offline KYC process can take around a week. It takes less time to complete your KYC online than offline. 

3)What is the investment amount above which the KYC process is needed?

You cannot invest in a mutual fund without completing your KYC. After completing your online KYC or eKYC, you can invest a maximum of ₹50,000/- in mutual funds. You will require IPV (In-Person Verification) of your KYC documents if you wish to invest more than ₹50,000 in mutual funds. 

4)Can I invest in a mutual fund without completing the KYC process?

You cannot invest in a mutual fund without completing your KYC process. The KYC process is mandatory for mutual fund investing to avoid fraudulent investments and money laundering.

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