MUMBAI: Registration of new clients in the domestic equity and commodity markets will likely come to a standstill from August 1, due to confusion among brokers and market intermediaries over the operational aspects of new central KYC agency.
In a circular issued on July 21, the Securities and Exchange Board of India (Sebi) directed market participants including brokers, mutual funds and depositories to report KYC of new clients from August 1, to the Central Registry of Secularization and Asset Reconstruction and Security Interest of India (CERSAI).
The new KYC record keeping agency is jointly promoted by government and PSU banks. CERSAI was created to ensure single KYC for all financial products by the UPA government’s central KYC program.
As per the Sebi circular, all market intermediaries will have to upload KYC record of new clients from August 1 with CERSAI’s online platform compared to earlier practice of passing it to Sebi registered KRA’s. But all intermediaries will have to first register with CERSAI, a process which is yet to be completed.