Facing Problems with Mutual Funds and DEMAT KYC?
Here’s How to Fix It?
As of early 2025, approximately 1.3 crore investor accounts in India are on hold due to incomplete Know Your Customer (KYC) compliance. This issue affects about 12% of the nearly 11 crore investors under the Securities and Exchange Board of India’s (SEBI) purview. The primary reason for these holds is the use of now-invalid documents, such as utility bills and bank statements, for KYC verification. Additionally, a survey revealed that 63% of families faced challenges accessing one or more bank accounts online due to KYC issues, dormant accounts, or malfunctioning login credentials. These statistics underscore the widespread impact of KYC-related challenges across various online financial platforms.
Thank you for reading this post, don't forget to subscribe!Investing in mutual funds or trading through a DEMAT account has become increasingly popular among Indian investors. However, many investors face issues related to KYC (Know Your Customer) compliance. Without proper KYC, transactions in mutual funds or DEMAT accounts can be blocked or restricted. If you’re facing such issues, don’t panic—KYC problems are common and solvable.
Facing Problems with Mutual Funds and DEMAT KYC?
Understanding KYC and Its Importance
KYC is a regulatory requirement that helps financial institutions verify the identity of investors. It includes basic information like your name, date of birth, PAN, address, and mobile number, along with identity and address proofs.
For mutual fund investments and DEMAT accounts, KYC compliance is mandatory. If your KYC is incomplete, outdated, or has errors, your transactions may get rejected or paused. This can include problems like being unable to invest further, redeem funds, or even open a new account.
Common Problems Faced in KYC
Here are some of the typical KYC-related issues investors face:
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Mismatch in PAN or Aadhaar details
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Address not updated or mismatched with documents
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Incorrect personal details like name or date of birth
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Mobile number/email ID not linked or outdated
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KYC status showing as ‘On Hold’ or ‘Rejected’
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Multiple KYC records with different data in different platforms
These problems can happen if your documents were not uploaded properly, there was a mistake during the initial KYC, or if there have been recent regulatory updates requiring revalidation.
How to Check Your KYC Status
Before correcting anything, it’s important to know your current KYC status. You can check it online on KYC registration agency (KRA) websites like:
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CVL KRA: www.cvlkra.com
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CAMS KRA: www.camsonline.com
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NDML KRA: www.ndmlkra.com
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KARVY KRA: www.karvykra.com
You simply need to enter your PAN number and check if your KYC is “Verified,” “On Hold,” “Rejected,” or “Not Available.”
Steps to Correct Your KYC
If your KYC is incorrect or not updated, follow these steps:
1. Download the KYC Modification Form
Visit any KRA website or your mutual fund/stockbroker’s portal and download the KYC Modification/Update form.
2. Fill in the Correct Details
Carefully fill out the correct information that needs to be updated—this could include your name, address, email, mobile number, or Aadhaar details.
3. Attach Supporting Documents
Attach self-attested copies of relevant documents based on the information you are updating:
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PAN Card (for identity)
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Aadhaar/Passport/Voter ID/Driving License (for address)
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Recent utility bill or bank statement (if changing address)
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Recent passport-size photograph
4. Submit the Form
You can submit the completed form and documents:
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Physically at your mutual fund’s office or your broker’s branch
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Online through their website/app (if supported)
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Through email (check if your platform accepts scanned copies)
5. Track the Update
Once submitted, it may take 3–5 working days for the changes to reflect. You can check your KYC status again on the KRA website to confirm the update.
Re-KYC: A New Requirement
Due to SEBI’s recent updates, many investors are required to revalidate their KYC even if they had done it years ago. You may receive communication from your mutual fund house or broker asking for re-KYC. In that case, follow the same process as above.
To conclude with:
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Always keep your mobile number and email ID updated, as they’re essential for OTP-based authentication.
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Regularly check your KYC status if you notice any transaction issues.
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If you’re investing through an app, contact customer care—they usually guide you through the process or offer digital KYC correction.
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If your PAN is linked with incorrect KYC in multiple records, consider doing a centralized KYC update via CKYC (Central KYC Registry).