Capital markets regulator, the Securities and Exchange Board of India (SEBI), has unveiled a centralized mechanism for reporting and verification in the event of an investor’s demise. The framework also outlines operational guidelines for regulated entities and registered intermediaries dealing with individual investors. SEBI has set a commencement date of January 1, 2024, for the implementation of this new system.
Streamlining Verification Processes
SEBI aims to streamline the verification process for deceased investors. This initiative will leverage the KYC Registration Agency (KRA) for seamless reporting and verification, reducing administrative burdens for both investors and financial institutions.
Effective Date: January 1, 2024
Investors and market participants should take note that SEBI’s centralized mechanism for verification will be operational starting from January 1, 2024. The regulator has provided a timeline for stakeholders to prepare for this significant change.
Enabling Connectivity for Listed Companies
SEBI encourages listed companies to facilitate access to this centralized mechanism for investors holding physical securities. To achieve this, companies can establish connectivity with KRA through their Registrar and Transfer Agents (RTAs).
In conclusion, SEBI’s introduction of a centralized verification mechanism marks a significant step towards enhancing the efficiency and transparency of India’s capital markets. By implementing this framework, the regulator aims to simplify processes related to deceased investors, benefiting both investors and the financial industry.
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