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SEBI Plan for Orderly Wind-Down of KYC Registration Agencies

30 April 20251 min read
BANKING & FINANCESEBI Plan for OrderlyWind-Down of KYCRegistrationAgencies30 April 2025safalsetu.com

Why in the news

SEBI’s consultation paper explains how a KRA should close critical services in a controlled way, so that investors face no break in KYC.

Key facts

  • Triggers: insolvency, business cessation, regulatory action.
  • Principles: continuous services, protection of sensitive KYC data, compliance with statutory and contractual duties, and smooth transfer to a successor KRA.
  • KRAs must frame SOPs, map contingencies (legal suspension, licence loss, operational failure) and plan seamless handover of infrastructure, data and operations.
  • They must also finalise technical protocols, coordinate with SEBI and market infrastructure institutions, and adopt preventive and recovery measures.

Exam angle

  • KRA = KYC Registration Agency; document: consultation paper.

Test yourself

1. SEBI's proposed wind-down framework applies to which type of entity?

The framework is for orderly wind-down of KYC Registration Agencies.

2. Under SEBI's proposal, operations of a winding-down KRA would pass to whom?

The framework provides for transfer to a designated successor KRA.

3. Which of these is listed as a wind-down trigger in SEBI's KRA proposal?

Insolvency, business cessation and regulatory action were the scenarios.

This topic is part of Daily Current Affairs 30 April 2025 (26 topics).

All topics of the dayDay quizApril 2025

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