SEBI Proposes Uniform KYC Process for New Mutual Fund Folios

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  • Last Updated on 25 October, 2025

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KYC process for mutual fund folios

Consultation Paper; Dated: 23.10.2025

The Securities and Exchange Board of India (SEBI) has issued a Consultation Paper proposing the standardisation of procedures for opening mutual fund folios and executing the first investment.

1. Key Proposals

  • KYC Compliance Requirement – New folios opened by investors must be fully KYC-compliant both at the Asset Management Company (AMC) level and within the KYC Registration Agency (KRA) system.
  • Transaction Eligibility – Investors will be permitted to initiate transactions only after the KRA and the folio complete the KYC verification process and are marked as ‘KYC Compliant’.

2. Stakeholder Feedback

SEBI has invited comments from the public and market participants on the proposed framework.

Feedback can be submitted through the SEBI web form by November 14, 2025.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied