SEBI allowed Entities to use e-KYC Aadhaar Authentication services of UIDAI in Securities Market as sub-KUA

The Securities and Exchange Board of India(SEBI) vide Circular No. SEBI/HO/MIRSD/SEC-5/P/CIR/2022/99 dated 20th July 2022 has allowed Entities to use e-KYC Aadhaar Authentication services of UIDAI in Securities Market as sub-KUA.

The KUAs shall make it easier for these organisations to become sub-KUAs and provide the Aadhaar authentication services with regard to KYC. The KUA must allow SEBI-registered intermediaries to authenticate their clients using Aadhaar as a sub-KUA for KYC purposes.

The Circular is Given Below:

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 detailed 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.

For Official Circular Download PDF Given Below: