What is KYC ?

POSTED BY jigneshdesai05 ON June 7, 2012 7:58 pm ONE COMMENT

1) What exactly is KYC ?

2) What is it’s exact purpose (Why has Government enacted it ?)

3) Can it be useful in any way in PREVENTING FRAUD AGAINST THE iNVESTOR ?

4) Is CDSL (CVL) the only agency maintaining KYC Data ?

5) In which types of Investments is KYC done (or Compulsory) & who maintains the Data in each case ?

One reply on this article “What is KYC ?”

  1. Ashal Jauhari says:
    June 8, 2012 at 9:27 am

    Dear Jignesh, Here are the answers –

    1. KYC – stands for Know Your Customers

    2. Govt. has started it to track the source of funds & to prevent money laundering (stopping the entry of illegal or black money or even terrorist funds into the main stream system & earning return from this).

    3. Yes on the basis of KYC, there are checks & fraus can be minimized.

    4. If you meant for MFs & Share investment, yes CVL is the only agency.

    5. In case of Banking relationship, the KYC is done & maintained by bank itself. For Insurnce, by the insurer. For MFs & Stocks, by CVL.

    Thanks

    Ashal

    Reply

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