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PremiumThe Securities and Exchange Board of India (SEBI) has unveiled plans to implement a centralised system for reporting and confirming the demise of an investor, intending to enhance the efficiency of asset transfers within the securities market, reported Economic Times.
This circular will be in force starting from January 1, 2024.
The SEBI circular outlines operational guidelines to provide direction for registered intermediaries who interact with investors or account holders. It stipulates that upon receiving notification of an investor’s demise, the intermediary must initially acquire the death certificate and PAN from the notifier and then proceed to carry out the following actions:
If it is not possible to obtain the death certificate upon receiving information about the investor’s demise, the investor’s KYC status will be temporarily designated as “On Hold" until the document can be provided. Once the death certificate is verified, the KYC status of the investor will be updated by the KYC Registration Agency (KRA) to “information on the death of the investor received; death certificate verified".
It’s important to highlight that once the KYC status is updated, all debit transactions in the deceased investor’s account/folios will be suspended. Nevertheless, if the account is jointly held or operated in an “Either OR Survivor" mode, account operations will continue uninterrupted.
The circular also permits stock exchanges, depositories, and associations such as AMFI, Registrars Association, etc., to establish a shared Standard Operating Procedure and notify investors accordingly.
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