Updating your mutual fund KYC? Post offices can now do it for you

Experts believe the tie-up could help resolve long-standing bottlenecks in KYC compliance, particularly in underserved regions

The Department of Posts (DoP) has partnered with the Association of Mutual Funds in India (Amfi) to provide Know Your Customer (KYC) verification services through its vast network of over 164,000 post offices across India.

 

The agreement, signed on July 17, aims to streamline KYC compliance for approximately 241.3 million mutual fund folios, including 190.4 million equity, hybrid and solution-oriented schemes.

 

“This collaboration harnesses our extensive postal infrastructure to support financial inclusion and simplify KYC processes for investors nationwide,” said Manisha Bansal Badal, general manager (Business Development), Department of Posts.

 

Why does this matter for investors?

 

KYC compliance is mandatory for investing in mutual funds. Until now, offline investors had to visit asset management companies (AMCs) or registrar offices for document verification.

 

Under this initiative, postal employees will assist investors in:

 

Completing KYC forms

 

Verifying and attesting self-attested documents

 

Forwarding them to AMCs for processing

 

“This MoU marks a significant step in the industry’s efforts to ensure regulatory compliance for investors residing in remote areas,” said VN Chalasani, chief executive, AMFI.

 

Experts see a big boost for participation

 

Financial experts say the tie-up could help resolve long-standing bottlenecks in KYC compliance, particularly in underserved regions.

 

“Enabling KYC at post offices is a strong move. In rural and semi-urban areas, trust matters more than tech, and post offices are trusted places. This will remove a key entry barrier for mutual fund investors in these regions,” said Navy Vijay Ramavat, managing director, Indira Group.

 

“For those whose KYC is stuck or rejected, this brings a much-needed physical touchpoint. Even in bigger cities, many people still struggle with digital-first norms. If executed well, this step can bring first-time investors into the fold, not just by simplifying KYC, but by making investing feel accessible, human, and local,” he added.

 

Niranjan Babu Ramayanam, chief operating officer, Anand Rathi Wealth Limited, believes this partnership could be a game changer,

 

“As per industry sources, there are many clients who have invested in the past but have not updated their KYC as per the latest regulatory requirements. With the widespread presence of post offices across the country, this MoU will help AMCs reach such clients and assist them in updating their KYC to restart investments.” he said

 

What investors need to know?

 

According to the Sebi’s current guidelines, accepted documents for KYC include:

 

Passport

 

Driving licence

 

Aadhaar card

 

Voter ID

 

NREGA job card (signed by a government officer)

 

National Population Register letter

 

How to check your KYC status?

 

Visit any mutual fund website or registrar portal

 

Enter your 10-digit PAN

 

Check if your KYC status is:

 

KYC Validated: Free to invest

 

KYC Registered: Can invest in existing AMCs but may require fresh KYC for new ones

 

KYC On-Hold/Rejected: Requires issue resolution

 

A potential game changer for mutual funds

 

India added nearly 9.7 million new mutual fund investors in FY25. Experts say this initiative could unlock further growth, especially as Sebi’s tightened KYC norms have left many investors unable to transact.

 

“This initiative will help resolve the KYC ‘On Hold’ or ‘Rejected’ statuses more efficiently, especially in rural areas where investors lack guidance to complete documentation,” said Ramayanam.

 

“There will be a substantial rise in SIPs from such investors once their KYC is validated.”

 

The agreement, effective for one year and renewable, includes strict confidentiality safeguards and Sebi compliance.