Once implemented, the new framework would allow centralised storage and portability of key supplementary KYC information, mandate periodic re-verification of KYC records, relax documentation requirements for certain categories of investors, and streamline processes such as account closure and mobile number verification.
A key proposal in the consultation paper floated by the Securities and Exchange Board of India (Sebi) is the centralisation of commonly collected supplementary information -- such as income range, occupation, place and country of birth, FATCA details, and politically exposed person (PEP) status -- at the KRA level.
Currently, such information is collected separately by each intermediary, requiring clients to repeatedly submit the same details.
Under the new framework, once this information is uploaded and validated by a KRA, it can be shared across intermediaries, significantly reducing onboarding friction when an investor approaches a new broker, mutual fund, or other market intermediary.
Sebi has also proposed standardising income slabs and allowing KRAs to tag independently verified supplementary information, improving the reliability and usability of KYC records.
To address the issue of outdated KYC records, Sebi has proposed that all KYC records be reviewed at least once every five years.
KRAs would be required to send automated alerts to intermediaries if a KYC has not been updated within this period, if the validity of an officially valid document (OVD) has expired, or if a minor client has attained majority.
Updated information shared with one intermediary would automatically be made available to all other intermediaries dealing with the same client through the KRA system, reducing repetitive compliance exercises.
 "KYC")