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SECP Simplifies Digital Onboarding for Mutual Fund Investors

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In continuation of its efforts to promote financial inclusion through digitalization and increase the investor base and micro-savings, the Securities and Exchange Commission of Pakistan has specified a swift and simplified onboarding framework for customers of the Asset Management Companies and Pension Fund Managers.

Under the new framework, the accounts can be opened online, while the Asset Management Companies (AMCs) and Pension Fund Managers (PFMs) can conduct customer verifications and authentication through virtual platforms such as WhatsApp and Skype, etc.

The new framework classifies three categories of investment accounts on the basis of investment and transaction limits, and documentation/verifications, which are the Sehl Sarmayakari Account, the Sahulat Sarmayakari Account, and the Sarmayakari Account. Digital joint account opening is also allowed under this new framework.

The Sehl Sarmayakari Account allows users to be onboarded through digital wallets without providing any additional information or document to the AMCs. The Sahulat Sarmayakari Account requires additional documentation but does not necessitate customer risk profiling for investments (in Money Market and Low-risk Income Schemes).

The Sarmayakari Account is the most comprehensive and does not have an investment or transaction limit, which is why it requires additional legal documentation/information. Furthermore, the customers of all these accounts have the option of upgrading them by fulfilling the particular account requirements in due time.