Description

NSE extends the deadline for Trading Members to upload client KYC records to KRAs to April 03, 2026, following non-compliance with the 3-day upload timeline mandated by SEBI.

Summary

NSE has extended the deadline for Trading Members to upload client KYC records to KRAs (KYC Registration Agencies) to April 03, 2026. This extension follows widespread non-compliance with SEBI’s revised 3-day upload timeline mandated in October 2023. After the extended deadline, clients without “KYC Registered” or “KYC Validated” status will not be permitted to trade or square off open positions.

Key Points

  • SEBI revised KYC upload timeline from 10 working days to 3 working days effective October 12, 2023
  • Sample comparison revealed several Trading Members have not complied with the 3-day timeline
  • Only clients with “KYC Registered” or “KYC Validated” KRA status are permitted to trade
  • Previous deadline from circular NSE/ISC/71986 dated December 24, 2025 has been extended
  • Non-compliant PANs will be restricted from trading and squaring off open positions after April 03, 2026
  • Members must closely monitor open positions of such clients

Regulatory Changes

The circular references the evolution of KYC upload timelines:

  • Original requirement: SEBI Circular MIRSD/Cir-26/2011 (December 23, 2011) mandated 10 working days for KYC upload and document dispatch
  • Revised timeline: SEBI Circular SEBI/HO/MIRSD/SECFATF/P/CIR/2023/169 (October 12, 2023) reduced timeline to 3 working days from completion of KYC process
  • Trading permission: SEBI Circular SEBI/HO/MIRSD/FATF/P/CIR/2023/0144 (August 11, 2023) allows clients to transact upon KYC completion, but unverified clients cannot transact further until verification is completed

Compliance Requirements

For Trading Members:

  1. Upload all pending client KYC records to KRAs by April 03, 2026
  2. Ensure compliance with 3-day KYC upload timeline for new clients going forward
  3. Verify KRA status of client PANs with respective KRAs
  4. Closely monitor open positions of clients with non-validated KRA status
  5. Take appropriate measures to ensure compliance before the deadline
  6. Contact respective KRAs directly for queries or issues related to client KRA status

Client Requirements:

  • Must have KRA status of “KYC Registered” or “KYC Validated” to trade
  • Clients with unverified KYC attributes cannot transact until verification is completed

Important Dates

  • January 30, 2026: Circular issue date
  • April 03, 2026: Extended compliance deadline for uploading client records to KRAs
  • After April 03, 2026: Non-compliant PANs will be restricted from trading and squaring off open positions

Impact Assessment

Operational Impact:

  • Trading Members with significant backlogs of unuploaded KYC records face substantial operational workload to meet the April 03, 2026 deadline
  • Members must implement processes to ensure ongoing 3-day compliance for new clients
  • Resource allocation required for reviewing and monitoring client KRA status

Client Impact:

  • Clients whose KYC records are not uploaded by the deadline will face trading restrictions
  • Clients with open positions may be unable to square off if their KRA status is not validated
  • Potential inconvenience to investors due to trading restrictions

Market Impact:

  • Ensures seamless interoperability across market participants
  • Strengthens compliance with SEBI’s KYC framework and risk management requirements
  • Maintains integrity of client verification process across the securities market

Contact Information:

Impact Justification

Critical compliance matter affecting all Trading Members. Non-compliant clients may be restricted from trading and squaring off open positions after April 03, 2026. Direct operational impact on member firms and their clients.