SEBI launches MITRA to help trace inactive mutual fund folios, platform to be managed by CAMS and KFin Tech

MITRA will be available through a link on the website of MF Central, AMCs, AMFI, the two QRTAs and SEBI.

The market regulator has announced the launch of Mutual Fund Investment Tracing and Retrieval Assistant (MITRA) platform, which will be managed by two Qualified RTAs namely Computer Age Management Services Limited (CAMS) and KFIN Technologies Limited as agents of AMCs.

This is to help investors easily trace their inactive mutual fund folios, which have been defined as those folios in which no investor has initiated transaction/s (financial and non-financial) for 10 years but has unit balance available. The QRTAs have been asked to make platform active 15 working days from the issuance of the circular dated February 12.

Through the circular, the Securities and Exchange Board of India (SEBI) said that the platform will help investors to identify overlooked investments or any investments made by any other person for which he/she may be a rightful legal claimant.

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The regulator is also hoping that platform will encourage investors to do the Know Your Customer (KYC) process and reduce the non-KYC compliance folios and that it will reduce the number of unclaimed folios.

The circular said, "Over a number of years, Mutual Fund investors sometimes lose track of their investments considering investments might have been made in physical form with bare minimum KYC details. The investments in open- ended growth option mutual fund schemes may remain invested perpetually until and unless investor/his nominee/legal heir approaches the concerned AMC for redemption/transfer/transmission."

It added, "Due to non- availability of PAN, email ID or valid address it is also possible that these MF folios may not appear in the unitholder’s Consolidated Account Statement. Thus, inactivity in Mutual Fund folios could be on account of the investor losing track of his/her investment, demise etc. Such inactive folios may become susceptible to fraudulent redemptions."

The MITRA platform will be hosted jointly by the two Qualified RTAs (QRTAs) and will be available through a link on the website of MF Central, AMCs, AMFI, the two QRTAs and SEBI.

The QRTAs will be jointly and severally responsible for compliance with all the applicable regulations including system audit and cyber security audit. Further, the QRTAs should ensure that the platform complies with the guidelines for Business Continuity Plan (BCP) and Disaster Recovery (DR) specified by SEBI from time to time to MIIs.