SEBI Exempts NRIs from Re-KYC for New Investments Until 2025

SEBI has exempted NRIs having KYC ‘Registered’ status from doing re-KYC to invest in a new fund house till April 30, 2025.

With this, NRIs having KYC ‘Registered’ status will be treated like KYC ‘Validated’ status till April 30, 2025.

By May 31, the KYC Registration Agencies (KRAs) will revalidate KYC status of all mutual fund clients including NRIs. NRIs where KYC was ‘On hold’ due to non-validation of both email id and phone number or inoperative PAN due to Aadhaar PAN linking issue will get KYC ‘Registered’ status.

However, either of email id or mobile number has to be validated to get the ‘Registered’ status.

While NRIs are exempted from obtaining Aadhaar, such a linkage was necessary for NRIs investing in capital market products like mutual funds, PMS, AIFs or direct stocks.

NRIs will continue to have ‘On hold’ status if any one of email id or mobile number is not validated. Even if they quote foreign phone number but their email id is invalid or not validated, they will continue to be on ‘On hold’ status. NRIs with KYC status of ‘On hold’ will have to do re-KYC to execute financial or non-financial transactions in mutual funds and other capital market products.

For new NRI clients, they must obtain Aadhaar and their Aadhaar has to be linked to Indian phone number to carry out online KYC.

NRIs who do not have Aadhaar can continue to do physical KYC with their physical presence in India.

NRIs account for 4% of the total MF AUM. As on April 2024, the NRIs contributed AUM of Rs. 2.28 lakh crore.