Query on the new KYC Norms for Mutual Funds

POSTED BY Ajay ON October 14, 2010 8:27 pm COMMENTS (3)

As on Oct 1 2010 there is a change in the KYC norms for mutual funds. Pls see the link KYC

My question is on the specific term used “Channel Investor” or “Channel Distributor”. What does this mean ? In what case does a retail investor fall in this category ?

 

 

 

3 replies on this article “Query on the new KYC Norms for Mutual Funds”

  1. Kiran Srirama says:

    Channel Investor is the investor who buys mutual funds through channel parters – eg : ICICI Direct, Fundsindia, etc…

    When invested through Channel Partners, some services (both financial and non-financial) such as despatch of statements, account details modification, etc.. are provided by them, some services can be availed by both MF AMC and channel partner.

    1. Ajay says:

      @Kiran, Thanks for the response.

      Followup query –
      1. Does this mean if I purchase directly from the fund house (e.g. HDFCFUND.com, ICICIPruAMC.com, Quantum etc) or visiting their Investor Service centers I DO NOT fall under this category ?
      2. Does this mean if I purchase from a broker (e.g. the “friendly neighbourhood person” who asked me to buy the MF from him) I WILL fall under this category ?

      1. Kiran Srirama says:

        1.
        Yes.

        2.
        NO. Normal brokers/agents are different from Channel partners. Channel partners are those who provide some (probably most) of the services to you. While brokers/agents would also be able to provide you all the services, if you invest through Channel partners you must mandatorily avail certain services through them.

        For eg: If I invest in Birla MF through fundsindia.com (online Channel parner), birla MF online site doesn’t allow me to purchase from their site directly. On the other hand if I had invested through a normal broker/agent, Birla MF allows me to purchase directly.

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