SEBI issues advisory on e-wallets to be KYC norms compliant for investing in mutual funds

SEBI issues advisory on e-wallets to be KYC norms compliant for investing in mutual funds

The provisions would be applicable from 1 May

The Securities and Exchange Board of India (SEBI) has said that e-wallets used for investing in mutual funds (MFs) should be compliant with KYC norms as prescribed by the Reserve Bank of India (RBI).

In its May 2017 circular, the market regulator had allowed the use of e-wallets for investment in MFs within the limit of Rs.50,000 for investments. This was especially to enable the younger generation to purchase the instruments through both e-wallet and/or cash per mutual fund per financial year.

The move was also part of the efforts to promote digital payments in the MF industry and channel household savings into the capital market.

Issued to protect the interests of investors in securities, the circular read, “This circular is issued in exercise of the powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with Regulation 77 of the Securities and Exchange Board of India (Mutual Funds) Regulations,1996 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.”