The Hindu Business Line : Brokers’ body seeks simpler KYC norms

The association’s view is based on the premise that the KYC given its bulky nature, has little direct application. In fact, the association is willing to have a ‘Master KYC’ as a single-point reference. A simpler version of this may then be introduced for everyday use.

“We wish to make it (KYC) a more effective proposition,” said Mr Nirmal K Agarwal, President, adding that the idea is not to let it become a mere tool for compliance. However, even a simpler version should take into consideration all essential aspects related to risks.

The association also wants to do away sub-brokers’ registration because of their limited role . It is now a broker’s responsibility to issue contract notes; the sub-broker is more often than not a mere ‘introducer’. The latter, therefore, need not be separately registered.

The body also sought disclosure of broad investment trends to enable investors to track investment patterns. “This will be a vital step, especially so in today’s context marked by high volatility and large deals,”, Mr Agarwal told newspersons.

The association is of the view that consolidation in the broking fraternity will drive growth. This will lead to the creation of larger players, complete with superior infrastructure and wider reach.

“There has been a series of M&A in the broking industry in recent times, thanks partly to the foreign players that want to enter the Indian market,” said Mr Bijay Murmuria, Alternate President. Ordinary investors need to benefit from such consolidation, the association has observed.

BSE members join in

The association – which in its earlier avatar was association of NSE Members of India – has now started roping in BSE members to broadbase its membership. About 50 BSE members have joined so far. This follows the approval for a name change by the Registrar of Companies. Last week, the association had finalised a business code of conduct for members.

This is expected to empower the brokers’ body once it turns itself into a self-regulatory organisation (SRO). The regulator, it is felt, will like to deal with a single SRO formed by brokers.