AMCs to freeze non-PAN card MF portfolios from April 2023, says AMFI | Job Binary

From April 2023, investors will not be able to invest in mutual fund folios that are not linked to their PAN card, the Association of Mutual Funds in India (Amfi) said in a notification.

“No investments (systematic or lumpsum) shall be permitted in such folios for which PAN or PAN Exemption KYC Reference Number (PEKRN) is not available. Dividend payment from MF schemes to such folios shall also not be permitted,” Amfi said.

The industry body has asked investors to link such MF accounts with their PAN or PEKRN by March 31, 2023.

Restrictions on redemptions from such transactions are already in place from September 2019. Amphi has denied redemptions from such accounts after the Securities and Exchange Board of India (SEBI) raised concerns about the high volume of redemptions from such accounts.

According to a report, nine million MF folios are not linked to PAN as of 2019 and most of these folios are more than 11-12 years old. Because PAN is mandatory for MF investments from January 1, 2011, only when fund houses adopt a new set of Know-Your-Customer (KYC) compliance norms.

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