The Central KYC Records Registry (CKYCR) is a centralized repository of KYC records of customers in the financial sector. This article explains how the CKYCR works for PMS clients and the compliance requirements for Portfolio Managers.
What is Central KYC Registry?
Definition
Central KYC Registry (CKYCR) is a centralized repository of KYC records of customers in the financial sector through an entity substantially owned and controlled by Central Government to receive, store and safeguard the KYC records of a client in digital form.
Purpose
The CKYCR aims to:
- Avoid duplication of KYC efforts
- Enable single-window onboarding
- Facilitate sharing of KYC records across financial sector entities
- Reduce compliance burden for clients
Regulatory Framework
Legal Basis
KRAs shall upload the verified/validated KYC information onto the system of CKYCRR. This is mandated under SEBI circulars and PMLA Rules.
Timeline for Upload
KRAs shall upload the verified/validated KYC information onto the system of CKYCRR within 7 days of receiving the same from intermediaries or any other timeline as notified under PML Rules.
How CKYCR Works for PMS
KYC Upload by KRAs
KYC Registration Agencies (KRAs) upload KYC information to CKYCR. This includes:
- Identity details
- Address details
- Photograph
- PAN information
Access by Portfolio Managers
Portfolio managers can access KYC records through:
- KYC Registration Agencies (KRAs)
- Direct access to CKYCR (as per new PMLA Rules)
Single-Window Onboarding
SEBI has emphasized the convenience of single-window onboarding: "A PMS investor should undergo the onboarding and KYC process only once, with reliance on KYC registered with KRA to avoid duplication within the custodian ecosystem".
Benefits for Portfolio Managers
Reduced Compliance Burden
Portfolio managers can rely on KYC records already available in CKYCR, reducing the need to collect and verify documents repeatedly.
Faster Onboarding
Access to centralized KYC records enables faster client onboarding.
Improved Efficiency
Portfolio managers can focus on core activities rather than duplicative KYC processes.
Benefits for Clients
Single KYC
Clients need to undergo KYC only once, with records available across the financial sector.
Convenience
Clients do not need to submit documents repeatedly to different portfolio managers.
Consistency
KYC records are consistent across the financial sector.
Compliance Requirements for Portfolio Managers
Verification
Portfolio managers must verify KYC records obtained from CKYCR.
Record Maintenance
Portfolio managers must maintain records of KYC verification.
Reporting
Portfolio managers must report any discrepancies in KYC records.
Technical Aspects
CKYCR System
The CKYCR system is maintained by an entity substantially owned and controlled by Central Government.
Data Security
CKYCR has prescribed uniform KYC guidelines and ensures data security.
Registration
Reporting entities may register in CKYCR provided their institution type is included in the approved list.
Expert Legal Guidance
Anuj Desai & Associates provides expert legal advisory services on CKYCR compliance for portfolio managers. Our securities law experts help clients understand CKYCR requirements, implement access procedures, and maintain compliance. Contact us for guidance on CKYCR and other regulatory matters.