The Securities And Exchange Board of India (SEBI) on Wednesday (October 4) announced a centralised mechanism for reporting and verification in case of the demise of an investor.

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Listed companies that aim to provide beneficial access of this mechanism to their investors holding securities in physical form will need to establish connectivity with KYC Registration Agency (KRA) through their Registrar and Transfer agents (RTAs).

SEBI said in case the death certificate of a deceased investor cannot be obtained, the KYC status of the investor will be earmarked as 'On Hold', till the document can be furnished.

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The circular added that debit transactions in the account or folios of the deceased investor shall be blocked after the KYC status gets updated. The exception is laid out only if the account is operated as a joint account.

Further, SEBI said for uniform application of these guidelines, stock exchanges depositories and industry associations in the country can hold consultations with stakeholders including KRAs to put in place a common Standard Operating Procedure (SOP).

This circular shall come into effect from January 01, 2024.

(Edited by : Anshul)