Sebi directs registrar and transfer agents to develop a common platform

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Market regulator Sebi (Securities and Exchange Board of India) has asked registrars and transfer agents (RTAs) to jointly develop a common platform for serving existing and future mutual fund investors. The platform will allow investors to place both transaction and service requests. It would act as a one-stop shop for financial and non-financial mutual fund transactions. The platform will be jointly built by RTAs- KFintech and CAMS.

Investor convenience

The said platform in phases will enable a user-friendly interface for investors for the execution of mutual fund transactions, initiation and tracking of service requests as well as queries and complaints, access investment related reports, transactions reports, capital gains or loss reports, details of unclaimed dividend and redemption among others.

In simple words, if you are someone who is investing in two mutual funds and they both are serviced by RTAs. One by KFintech and another one by CAMS and you wish to change or add a nominee in both, then currently you need to go inform both the RTAs separately. However, after the platform goes live, you can get the changes done in both schemes in one go.

“RTAs shall implement standardized practices, system interoperability amongst themselves to jointly develop a common industry-wide platform that will deliver an integrated, harmonized, elevated experience to the investors across the industry,” Sebi said.

New services

The platform may also over time, provide services to the distributors, registered investment advisors, AMCs (asset management companies), stock exchange platforms and digital platforms for transacting in mutual funds to further augment ease of investing and servicing of investors through the stakeholders in consultation with Sebi.

Further, AMCs, RTAs, and depositories will have to review and agree to harmonize the processes across the industry to provide a single-window, integrated, simplified investment and service experience for the investors.

In addition, they will have to adapt the data definitions and standards as recommended by Sebi for data exchange amongst various participants.

The platform should be scalable with robust cybersecurity protocols and supported through an API-based architecture.

Power of one

All the stakeholders have been asked to collaborate and work together towards the development and implementation of the proposed investor-friendly platform.

AMCs and depositories will have to facilitate and RTAs will have to make the platform operational in a phased manner (starting with non-financial transactions) and will be fully operational by December 31, 2021.

The regulator has asked AMCs, RTAs, depositories, industry body Amfi, and key stakeholders to create awareness about this initiative amongst the investors.