Circular No. SEBI/HO/OIAE/OIAE_IAD-1/P/CIR/2023/0000000163, Dated: 03.09.2023
The SEBI has introduced a centralized mechanism for reporting and verifying the demise of an investor through the KYC Registration Agency (KRAs) to smoothen the transmission process in the securities market.
Further, upon receipt of intimation about the demise of an investor, the concerned intermediary must obtain a death certificate along with the PAN from the notifier. After verifying the death certificate, the concerned intermediary must submit a KYC modification request to the KRA.
Additionally, the SEBI has also outlined the obligations of KRAs. Upon receiving the ‘KYC modification’ request from the intermediary, the KRA must conduct independent validation and verification by the next working day after receiving the modification request.
Once the death certificate is validated, the KRA must update the KYC record as “Blocked Permanently” in the system and notify all linked intermediaries of this update.
If the KRA identifies any errors or issues with the modification request as aforesaid, it must consult with the concerned intermediary and share details of its observations and accordingly update the KYC status to either “Modification Rejected and Cleared ( i.e. Validated) or “Blocked Permanently”, as the case may be, by the next working day.
Also, in order to ensure uniformity in operationalizing this circular, Stock Exchanges, Depositories and industry associations like the Association of Mutual Funds in India (AMFI), Registrars Association of India (RAIN) etc. in consultation with stakeholders including KRAs, may put in place common Standard Operating Procedure (SOP).
The SOP must be made available on their websites as well as those of the intermediaries. The circular shall be effective from 01.01.2024.
Click Here To Read The Full Circular
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