How-to e-KYC Aadhaar mutual fund onboarding KYC

How to complete e-KYC for mutual funds via Aadhaar OTP

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Aadhaar OTP-based e-KYC is the dominant onboarding mechanism for first-time mutual fund investors in India. Under the KYC Registration Agency (KRA) framework operationalised by SEBI, a single Aadhaar-OTP e-KYC verification serves the investor across all SEBI-registered AMCs and distributors. The Aadhaar OTP route is faster than video KYC , simpler than in-person verification, and requires no physical documents beyond the Aadhaar number and an Aadhaar-linked mobile.

The Aadhaar OTP e-KYC route has limits: under SEBI rules, an investor verified through Aadhaar OTP alone (without supplementary biometric verification) is restricted to investments of up to Rs 50,000 per AMC per financial year. For investments above this threshold, the investor must upgrade to full KYC through video KYC , in-person verification, or Aadhaar biometric verification. This article walks through the Aadhaar OTP e-KYC flow end-to-end, with the upgrade paths covered toward the end.

Prerequisites

Aadhaar-mobile linkage

The Aadhaar OTP arrives on the mobile number registered with Aadhaar (in UIDAI’s database). The investor must confirm this linkage before starting:

  • mAadhaar app: install on the registered mobile, log in, and verify the registered mobile in the profile section.
  • UIDAI’s resident services portal: uidai.gov.in → Aadhaar Services → Verify Aadhaar.
  • myAadhaar portal: log in and check the registered mobile.

If the registered mobile is different from the investor’s current mobile, the mobile must be updated through UIDAI’s “Update Mobile Number” service, which requires an in-person visit to an Aadhaar Seva Kendra (this is a one-week-plus process and is the principal blocker for many first-time e-KYC attempts).

PAN-Aadhaar linkage

PAN must be linked to Aadhaar for mutual fund KYC. The linkage can be verified at incometax.gov.in. Unlinked PANs are treated as inoperative for tax and securities purposes and the mutual fund KYC may fail.

Other prerequisites

  • A mobile email address registered to the investor.
  • A bank account in the investor’s name (will be linked during KYC).
  • An Internet connection on a smartphone or computer to complete the workflow.

Platform options for e-KYC

CAMS Online (myCAMS)

CAMS Online handles KYC and folio creation for the approximately 25 AMCs that use CAMS as their RTA. The Aadhaar e-KYC flow at CAMS:

  1. Visit camsonline.com or the myCAMS mobile app.
  2. Select “New Investor” or “Open Account”.
  3. Choose Aadhaar OTP e-KYC.
  4. Follow the steps below in the operational walkthrough.

After KYC at CAMS, the investor can transact in any CAMS-RTA scheme without re-KYC.

KFinKart

KFinKart is the equivalent portal operated by KFin Technologies for the approximately 15-20 KFin-RTA AMCs (Axis, DSP, Nippon India, Quant, PPFAS for certain schemes, and others). The flow mirrors CAMS Online.

Mutual Fund Utility (MFU)

MFU (mfuonline.com) is the AMFI-promoted utility that handles KYC and creates a Common Account Number (CAN) usable across all AMCs (both CAMS and KFin RTAs).

AMC-direct portals

Each AMC operates its own KYC entry point on its main website. The Aadhaar e-KYC flow is similar across all AMC portals; the difference is that the KYC is recognised across all AMCs via the KRA framework once any one portal completes it.

Broker-aligned platforms

Discount brokers including Zerodha Coin , Groww , Kuvera , and ET Money embed Aadhaar e-KYC into their account-opening flow. The KYC is also recognised across the KRA framework.

Operational walkthrough

The procedure shortcode at the top of this article documents the step-by-step flow. The expansion below covers operational nuances at each step.

Step 1: Verify Aadhaar-mobile linkage

Before any e-KYC attempt, verify that the mobile number you intend to use for OTP receipt is the one registered in UIDAI’s Aadhaar database. The mAadhaar app, accessible after a one-time setup, shows the registered mobile in the profile section. The UIDAI website at uidai.gov.in provides equivalent verification through the Verify Aadhaar service.

If the registered mobile is incorrect:

  • Visit any Aadhaar Seva Kendra with your Aadhaar card.
  • Update the mobile number through the in-person update process (Rs 50 fee).
  • Wait 3-5 business days for the update to propagate through UIDAI systems.
  • Retry the e-KYC after propagation.

Step 2: Begin e-KYC on the platform

Navigate to the chosen platform’s KYC entry. Most platforms now prominently feature the e-KYC option as part of new-account-opening flows. Select Aadhaar OTP e-KYC (sometimes labelled “Instant KYC” or “Aadhaar e-KYC”).

Some platforms allow alternative selection of Aadhaar biometric KYC (which uses fingerprint or iris scan and does not have the Rs 50,000 per AMC limit) or video KYC . The Aadhaar OTP route is fastest but carries the financial-year-cap limit.

Enter your 12-digit Aadhaar number. Some platforms also ask for the virtual Aadhaar identifier (VID, a 16-digit substitute that masks the actual Aadhaar number). Either is accepted.

The consent step requires you to acknowledge that the platform will request UIDAI to share your Aadhaar-database details (name, address, date of birth, photo) with the KRA and the RTA. Read the consent text and confirm.

Step 4: Receive and enter OTP

The OTP arrives on the Aadhaar-linked mobile within seconds. Enter it in the e-KYC interface within the validity window (typically 10 minutes from issuance).

If the OTP does not arrive:

  • Wait 60 seconds and click “Resend OTP”.
  • Verify mobile network reception.
  • Confirm the Aadhaar-linked mobile is the device receiving messages.
  • Check if UIDAI’s OTP service is operational (occasional service issues).

Step 5: Complete additional details

UIDAI provides only name, address, date of birth, and photo from the Aadhaar database. The platform asks for additional details that are required for mutual fund KYC but not in the Aadhaar database:

  • PAN: your 10-character PAN. The platform verifies the PAN through the income-tax department’s API.
  • Bank account: account number, IFSC code, and account holder name. The platform may require a cancelled cheque image upload or penny-drop verification.
  • Occupation: professional or business activity.
  • Income range: SEBI-prescribed income brackets (e.g., below Rs 1 lakh, Rs 1-5 lakh, Rs 5-10 lakh, Rs 10-25 lakh, above Rs 25 lakh).
  • Tax residency: confirmation that you are an Indian tax resident.
  • Politically Exposed Person (PEP) declaration: standard FATCA-aligned declaration.
  • FATCA / CRS declaration: for cross-border tax reporting compliance.

Some platforms ask for a digital signature scan or a sample signature image.

Step 6: Confirm KYC completion

After submission, the platform sends the application to the KRA (CAMS KRA, KFin KRA, NDML KRA, or other SEBI-registered KRAs). The KRA verifies the data and returns the KYC status.

Standard processing times:

  • Same-day completion: most Aadhaar OTP e-KYC applications complete within minutes when all data is correct.
  • 1-3 business days: applications with minor data inconsistencies (PAN-name mismatch, bank account verification delays).
  • Longer: applications flagged for manual review (PEP-related, high-risk indicators).

Confirmation arrives via email and SMS. The KYC status becomes “Verified” in the KRA repository and the investor can now transact in mutual funds.

Limits and upgrades

Rs 50,000 per AMC per FY limit

Aadhaar OTP-only e-KYC is subject to a SEBI-prescribed limit of Rs 50,000 per AMC per financial year. The investor can subscribe to multiple AMCs at this limit (so total across 10 AMCs could reach Rs 5 lakh in a year), but a single AMC cannot accept more than Rs 50,000 from an OTP-only-KYC investor in any one financial year.

The limit was set to manage anti-money-laundering risks associated with the lower-friction Aadhaar OTP route. The limit is the SEBI default; AMCs can choose to apply lower limits internally if their risk policies are stricter.

Upgrade paths

To remove the Rs 50,000 limit and unlock full mutual fund investing, upgrade to full KYC via:

  1. Aadhaar biometric e-KYC: requires fingerprint or iris scan at an Aadhaar Seva Kendra. No financial-year limit applies after biometric verification.
  2. Video KYC : a SEBI-recognised alternative requiring a video call with a KYC officer. Operates remotely and is the most popular upgrade path.
  3. In-person verification (IPV): a representative of the AMC or distributor verifies the investor in person. Cumbersome but available.

After any of these upgrade paths, the investor’s KYC status updates in the KRA to “Full KYC verified” and the per-AMC limit is removed.

CKYC parallel

The Central KYC (CKYC) framework operates as a parallel KYC repository administered by CERSAI (Central Registry of Securitisation Asset Reconstruction and Security Interest of India). CKYC and the mutual-fund-specific KRA framework operate in parallel; a CKYC-verified investor may need to also complete the mutual-fund-specific KYC step depending on the AMC’s policy.

Common operational issues

PAN-Aadhaar name mismatch

The most common cause of e-KYC failure is a mismatch between the name on the PAN and the name in the Aadhaar database. Even minor differences (e.g., middle name initial vs full middle name, abbreviated surname) can cause rejection. The fix is to ensure consistent naming across PAN and Aadhaar through the appropriate update processes (PAN update through Income Tax department, Aadhaar update through UIDAI).

Bank account verification failure

If the bank account verification fails (penny-drop returns error, or the account holder name does not match the KYC name), the platform may pause the e-KYC pending resolution. Common fixes:

  • Re-enter the IFSC code and account number carefully.
  • Use a different bank account in the same name.
  • Upload a cancelled cheque image showing the printed account name.

Email or SMS not received

If the KYC confirmation email or SMS is not received, check:

  • Spam / junk folders in the email account.
  • Whether the email address registered in the e-KYC matches the active address.
  • The mobile number registered (some platforms send the SMS to the Aadhaar-linked mobile, others to a separately-registered mobile).

Income range disclosure considerations

The income range disclosure is used for AML / KYC purposes. Investors with significant income should disclose the appropriate higher bracket; under-disclosure can trigger AMC review of subsequent large transactions.

See also

External references

References

  1. SEBI Master Circular on Mutual Funds, KYC and onboarding sections, sebi.gov.in.
  2. UIDAI Aadhaar Act 2016 and operational documentation, uidai.gov.in.
  3. SEBI KRA framework circulars on the KYC Registration Agency ecosystem.
  4. SEBI circular on Aadhaar OTP-based e-KYC limits (Rs 50,000 per AMC per FY).
  5. CAMS KRA and KFin KRA operational documentation.
  6. Income Tax Department PAN-Aadhaar linkage requirement, incometax.gov.in.

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