Date: 2022-07-20Category: Not ApplicableState: Union GovernmentCountry: India
Entities allowed to use e-KYC Aadhaar Authentication services of UIDAI in Securities Market as sub-KUA <span style='color:#007ffc;'></span> <a style='color:#007ffc;' href='https://www.sebi.gov.in/sebi_data/commondocs/jul-2022/e-KYC_Aadhaar_annex_A_p.PDF' target='_blank'><em class='fa fa-external-link'></em>Annexure A</a>
**Summary:**
SEBI Circular SEBI/HOM/MIRSD/SEC/5/CIR/2022/99, issued on July 20, 2022, outlines the procedure for allowing specified entities in the securities market to use eKYC Aadhaar authentication services of the Unique Identification Authority of India (UIDAI) as sub-KYC User Agencies (sub-KUAs).
The circular refers to previous SEBI circulars (No. SEBI/HOM/IRSD/DOP/CIR/P/2019/123 dated November 05, 2019 and SEBI/HOM/IRSD/DOP/CIR/P/2020/80 dated May 12, 2020) that detailed the eKYC authentication facility and listed entities undertaking Aadhaar Authentication as KYC User Agencies (KUAs).
This circular follows a Gazette Notification (S.O. 3187(E) dated July 13, 2022) from the Department of Revenue, Ministry of Finance, Government of India, which notified 155 reporting entities as sub-KUAs under Section 11A of the Prevention of Money Laundering Act, 2002.
The circular mandates that these entities enter into an agreement with a KUA and register with UIDAI as sub-KUAs, adhering to UIDAI prescribed agreement terms and processes detailed in the SEBI circular dated November 05, 2019, and any subsequent UIDAI guidelines. KUAs are directed to facilitate the onboarding of these entities as sub-KUAs for Aadhaar authentication services related to KYC.
This circular is issued under the powers conferred by Section 11(1) of the Securities and Exchange Board of India Act, 1992, to protect investor interests, promote development, and regulate securities markets.
For further information, contact Sapna Sinha, Deputy General Manager, Market Intermediaries Regulation and Supervision Department, at Tel. no.: 022 2644 9748 or via email at sapna.sinha@sebi.gov.in.
Key Entities Referenced
Securities and Exchange Board of India (SEBI): Regulatory authority for the securities market in India, responsible for protecting investors and regulating the market.
KYC Registration Agencies (KRAs): Agencies registered with SEBI that maintain KYC records of investors in the securities market.
Unique Identification Authority of India (UIDAI): Statutory authority responsible for implementing the Aadhaar program, including Aadhaar authentication services.
Aadhaar: A 12-digit individual identification number issued by the Unique Identification Authority of India.
Prevention of Money Laundering Act, 2002: Indian law enacted to prevent money laundering and to provide for confiscation of property derived from money laundering.
KYC User Agency (KUA): An entity authorized by UIDAI to use Aadhaar authentication services for KYC purposes.
Department of Revenue, Ministry of Finance: A department within the Ministry of Finance, Government of India.
Securities and Exchange Board of India Act, 1992: Act of the Parliament of India to protect the interests of investors in securities and to promote the development of, and to regulate the securities market.
CIRCULAR
SEBI/HO/MIRSD/SEC-5/P/CIR/2022/99 July 20, 2022
To,
SEBI Registered Intermediaries:
1. KYC Registration Agencies (KRAs),
2. Stock Brokers through Stock Exchanges,
3. Depository Participants (DPs) through Depositories,
4. Mutual Funds (MFs) and AMCs through AMFI
5. Portfolio Managers (PMs)
6. Collective Investment Schemes (CIS),
7. Investment Advisors
8. Registrar and Transfer Agents
9. Custodians
10.Alternate Investment Funds (AIFs)
Dear Sir/Madam,
Subject : Entities allowed to use e-KYC Aadhaar Authentication services of
UIDAI in Securities Market as sub-KUA
1. SEBI issued circular No. SEBI/HO/MIRSD/DOP/CIR/P/2019/123 dated November
05, 2019 detailing the e-KYC Authentication facility under section 11A of the
Prevention of Money Laundering Act, 2002, by entities in the securities market for
Resident Investors.
2. Subsequently, SEBI vide its circular SEBI/HO/MIRSD/DOP/CIR/P/2020/80 dated
May 12, 2020 listed the entities who shall undertake Aadhaar Authentication service
of UIDAI as KYC user agency (KUA) in securities market.
The KUA shall allow SEBI registered intermediaries to undertake Aadhaar
Authentication of their clients as sub-KUA for the purpose of KYC.
3. In this regard, Department of Revenue-Ministry of Finance, Government of India,
vide Gazette Notification No. S.O. 3187(E) dated July 13, 2022 has notified 155
reporting entities as sub-KUA to use Aadhaar authentication services of UIDAI
under section 11A of the Prevention of Money-laundering Act, 2002. A copy of the
same is enclosed at Annex A.
4. The above mentioned entities shall enter into an agreement with a KUA and get
themselves registered with UIDAI as sub-KUAs. The agreement in this regard shall
be as prescribed by UIDAI. Further, the Sub-KUAs shall follow the process as
1detailed in SEBI circular dated Nov 05, 2019 and as may be prescribed by UIDAI
from time to time.
5. The KUAs shall facilitate the onboarding of these entities as sub-KUAs to provide
the services of Aadhaar authentication with respect to KYC.
6. This circular is issued in exercise of powers conferred under Section 11(1) of the
Securities and Exchange Board of India Act, 1992 to protect the interests of
investors in securities and to promote the development of, and to regulate the
securities markets.
Yours faithfully,
Sapna Sinha
Deputy General Manager
Market Intermediaries Regulation and Supervision Department
Tel. no.:022 2644 9748
email id: sapnas@sebi.gov.in
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