NCDEX tightens know-your-depositor regulations

NCDEX today introduced a new provision in know-your-depositor (KYD) norms which requires a depositor to provide a declaration that he is the sole beneficiary of the deposited goods.
The exchange is tightening the norms to strengthen physical delivery at the exchange-approved warehouses.
"The know-your-depositor (KYD) documentation process at the exchange-approved warehouses at the time of accepting deposits will now include a declaration by the depositor that he is the sole beneficiary of the deposited goods," National Commodity and Derivatives Exchange (NCDEX) said.
This declaration will have to be provided for every deposit, it said in a statement.
Market participants will need to comply with the new documentation (Transaction Wise Detail Form) forming part of the KYD process with immediate effect.

NCDEX MD and CEO Samir Shah said: "The exchange delivery system is very robust and the implementation of the additional declaration process will further strengthen the deposit process. This will help in strengthening market integrity."
NCDEX, the leading agri-commodity bourse in the country, also said it continues to take such steps to make sure the exchange operates orderly for a fair price discovery.