Sebi exempts certain MF clients from in-person verification

Mutual fund houses and market intermediaries need not carry out in-person verification of clients whose biometric authentication has been done at the time of issuing Aadhaar cards, according to Sebi.
The exemption would be applicable for clients whose investments per mutual fund is not more than Rs 50,000 in a financial year.
The clarification has been provided by Sebi through a list of Frequently Asked Questions (FAQs) related to voluntary adaption of Aadhaar-based electronic Know Your Customer (KYC) process.
In-person verification of the client is not required to be carried out by intermediaries in case verification with the UIDAI (Unique Identification Authority of India) was done through "biometric authentication (fingerprint or iris scanning)".

In such cases, the verification would be done with the UIDAI through a one-time password received on client's mobile number or on e-mail address registered with UIDAI.
However, this would be applicable only for those clients whose investments is not more than Rs 50,000 in a financial year per mutual fund.

Besides, such payments should have been done through electronic transfer from the client's bank account registered with that mutual fund.
Sebi noted that eSign Electronic Signature Service is an innovative initiative that allows easy, efficient, and secure signing of electronic documents by authenticating signer using Aadhaar e-KYC services.
"With this service any Aadhaar holder can digitally sign an electronic document without having to obtain a physical digital signature dongle," it added.

Electronic signatures facilitated through eSign Online Electronic Signature Service is legally valid provided it has been done within the legal framework.