Mumbai, Oct. 28 -- In a recently released draft circular, the Securities and Exchange Board of India (SEBI) has proposed a uniform procedure for opening new mutual fund folios and executing the first investment.

The purpose of introducing this uniform procedure is to address issues faced by investors and fund houses due to incomplete know your client (KYC) verification.

Under the new proposed rules, mutual fund investors can only start making transactions after their Know Your Customer (KYC) verification is fully completed and confirmed by the KYC Registration Agency (KRA).

Specifically, their investment accounts (folios) must be marked as "compliant" in the KRA's system.

This change is designed to eliminate errors and discrepancies t...