To make our capital markets robust, fast and efficient, the Securities and Exchange Board of India (SEBI) gave stock exchanges permission to start using the T+1 settlement cycle on January 1, 2022. In line with the change in settlement cycle in the Indian equity markets and to pass this benefit to Mutual Fund investors, redemption pay-out will be done in 2 business days after transaction date (T+2) from the existing T+3 business days. This change became effective from 01-Feb-2023.

2. Nomination for existing individual investors

All investors whose folio were created before 01-Oct-2022 and nomination is absent in the folio, are required to either provide nomination in the prescribed format or opt out of nomination through a signed declaration form on or before 31-Mar-2023. Investors can conveniently submit nomination form / opt out declaration form through online process or submit the duly filled and signed physical form at any of investor service centers. If investors fail to do the same before 31-Mar-2023, transactions like Redemptions / SWP / Switch / STP will cease in the applicable folios from 01-Apr-2023.

3. Two-factor Authentication (2FA) for Subscriptions (Purchases - Lump Sum & SIP)

After implementing two factor authentication at redemption, from 01-Apr-2023, all investors will be mandated to go through a two factor authentication, while online subscription of new folio with lump-sum purchase, new folio with SIP and Additional purchase in existing folio(s). In the case of mandates/systematic transaction(s), the requirement of 2FA shall be applicable only at the time of registration of mandate/systematic transactions. For such authentication for non-demat transactions, there will be a one-time password sent to the unit holder at his/her email or phone number registered with the AMC for authentication. Investors required to update all folios with current email id and mobile no before stipulated timeline of 01-Apr-2023 for smooth transactions. 

In case of demat transactions, the process of two-factor authentication as laid down by the depositories will be followed.

4. Link your Aadhaar with PAN

Investors need to link their Aadhaar with their PAN on or before 01 Apr, 2023. The PAN card will become inoperative if it is not linked with the Aadhaar by specified time. As a result, the KYC status becomes void and all transactions linked to mutual funds will not be processed. IDCW will continue if Aadhar is not linked to the pan but at a higher TDS rate for Resident Indians at 20% will be deducted instead of 10%.

5. Remediation of folios where PAN / PEKRN is not available

Investors need to update their PAN / PEKRN in the folios if it is not available before 01 Apr, 2023 or otherwise all financial and non-financial transactions may be restricted in the folio.

6. KYC Revalidation

A SEBI registered KYC Registration Agency (KRA) will soon commence revalidation of KYC records (Aadhaar, Email ID and Mobile number) that were submitted with Aadhaar as an Officially Valid Document (OVD) prior to 01-Nov-2022. Investors will be notified through Email / SMS / Physical letter communication to complete the revalidation and on receipt of such communication, KYC revalidation needs to be completed on or before 30-Apr-2023. If not validated, transactions will not be permitted from 01-May-2023.