SEBI Streamlines Process For Surrender Of KRA Registration

Circular No. SEBI/HO/MIRSD/PODFATF/P/CIR/2025/123, Dated 05.09.2025

1.Introduction

SEBI has issued a circular aimed at streamlining the process for the surrender of KYC Registration Agency (KRA) registration, whether such surrender is voluntary or involuntary. The move is designed to ensure greater transparency, efficiency, and protection of investor interests in the capital market ecosystem.

2. Seamless Transfer of KYC Records

Under the new framework, KRAs are required to ensure a smooth and secure transfer of KYC records to another SEBI-registered KRA. This step is crucial to avoid any disruption in investor services and to prevent any possibility of data loss or tampering during the transition process. The responsibility lies with the outgoing KRA to maintain integrity until the handover is completed.

3. Standard Operating Procedure (SOP)

SEBI has also mandated that every KRA must have a Standard Operating Procedure (SOP) approved by its Board. This SOP must be publicly available on the official website within 90 days of the circular. The SOP will serve as a guiding framework to standardize the surrender process and provide clarity to both investors and market intermediaries.

4. Oversight and Monitoring

To ensure compliance and effective implementation, SEBI has directed the constitution of Oversight Committees that will monitor the winding down process of KRAs. These committees will oversee the transition, safeguard investor data, and ensure that the surrender of registration does not adversely affect the capital market system.

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