Lost mutual fund folio? SEBI's tool could help find it
The Securities and Exchange Board of India (SEBI) has announced the development of a new platform, MITRA (Mutual Fund Investment Tracing and Retrieval Assistant). The initiative is aimed at helping investors locate inactive and unclaimed mutual fund folios. The need for such a platform comes as many investors lose track of their investments due to minimal KYC details or outdated personal information.
MITRA to address missing KYC details issue
Folios missing KYC details, such as a valid email address or PAN, might not even be reflected in a unitholder's Consolidated Account Statement. To address this concern, SEBI's MITRA platform will create an industry-level, searchable database of inactive and unclaimed mutual fund folios. This platform is being developed in collaboration with CAMS and KFIN Technologies.
MITRA platform: A tool for transparency and compliance
The MITRA platform will allow investors to find forgotten investments made in their name or find investments they might be entitled to claim. It seeks to promote KYC compliance by prompting investors to update their details, thus, reducing non-compliant folios. The platform also aims to promote transparency in the financial ecosystem by helping investors find inactive/unclaimed investments.
MITRA platform to minimize fraud risks
Along with encouraging transparency and compliance, MITRA platform will also have safeguards to minimize the chances of fraudulent redemptions. An "inactive folio" is one where no investor-initiated transactions have been made in the last 10 years, but the balance in the units still persists. The platform promotes tracking such investments and updating KYC details without any penalties for those who want to keep their investments active.
Beta version of MITRA platform expected soon
The MITRA platform will be jointly hosted by CAMS and KFIN Technologies, and will be accessible through MF Central, AMCs, and AMFI websites. A beta version is expected to be released within the next few months for a two-month trial period. AMCs, RTAs, and mutual fund distributors will be tasked with raising awareness about the new platform among investors.
