Operating Guidelines w.r.t. Purchase Fund Reconciliation pursuant to discontinuation of pool accounts for transactions in units of Mutual Funds on the BSE StAR MF Platform

NOTICES

Notice No.		20240702-34		Notice Date		02 Jul 2024
Category		Settlement/RMS		Segment		Mutual Fund
Subject		Operating Guidelines w.r.t. Purchase Fund Reconciliation pursuant to discontinuation of pool accounts for transactions in units of Mutual Funds on the BSE StAR MF Platform
Content

MEMBERS/PAYMENT AGGREGATORS

Sub: Operating Guidelines w.r.t. Purchase Fund Reconciliation pursuant to discontinuation of pool accounts for transactions in units of Mutual Funds on the BSE StAR MF Platform<_o3a_p>

SEBI vide Circular SEBI/HO/IMD/IMD-I DOFS/P/CIR/2021/635 dated October 04, 2021, discontinued usage of pool accounts for transactions in units of Mutual Funds using Exchange platforms and post July 1, 2022, subscription orders are processed by ICCL only upon receipt of funds directly from the Investor's bank account, and not through Market intermediaries (MFIs/ MFDs).<_o3a_p>

Members, PAs, PGs and Banks are requested to follow the notices issued by ICCL from time to time on any revised cut-offs / procedures / guidelines and implement the same within the stipulated period to ensure a timely and effective settlement process. <_o3a_p>

Kindly refer notice 20230620-66 dated 20th June 2023 with respect to
Execution of Purchase Transactions on BSE StAR MF Platform<_o3a_p>

https://www.icclindia.com/DynamicPages/DispNoticesNCirculars.aspx?page=20230620-66<_o3a_p>

To meet the above regulatory requirement, ICCL has entered into agreements with various Payment Aggregators ("PAs")/ Payment Gateways ("PGs") like Billdesk, Razorpay, Tech Process, Banks like HDFC Bank, ICICI Bank, Axis Bank, SBI, etc. for collecting the funds vide various modes of payments from the Investor's Bank account which is then transferred to ICCL's Approved bank account directly. ICCL has been receiving files/ MIS of Funds Confirmation from Payment Aggregators and Payment Gateways/ Banks. <_o3a_p>

Responsibilities of PAs/ PGs/ Banks:<_o3a_p>

1) PA / PG/ Bank shall make sure that the funds towards subscription of mutual fund units is accepted through only such modes where independent traceability of end investor can be ensured, and source account details are readily available. For each of the amounts transferred to an Approved Account of ICCL, the PA/PG/ Bank shall provide the bank account number, bank name, etc. to the ICCL after the credit of funds in Approved Account in the format specified by ICCL from time to time.<_o3a_p>2) PA / PG/ Bank, for the purpose of facilitation / transfer of funds to the Approved Account of ICCL and upload of files/ MIS of funds credited to the Account of ICCL in STAR MF portal, are advised to follow the timelines hereinbelow: <_o3a_p>

For settlement of funds to ICCL's Approved Account:<_o3a_p>

A) Direct Settlement: Funds Settlement will be on a Real-time basis. Modes include UPI & Net banking - Direct Banks, UPIR. <_o3a_p>B) Non-Direct Settlement: Funds Settlement will be on a T+1 day (T Day is the date of debit observed in client's bank account). Modes include NACH, NODAL, ISIP, SIP, XSIP, OTM, UPIR (collection by PA). <_o3a_p>

For the upload of files/MIS of funds credited to ICCL's Approved Account:<_o3a_p>

A) For L0 transactions, PAs/ PGs/Banks shall upload the Fund Confirmation MIS along with actual bank credit latest by 12.30 pm.

B) For other than L0 transactions, PAs/ PGs / Banks shall upload the Fund Confirmation MIS along with actual bank credit latest by 2:00 pm.<_o3a_p>

3) Correct details to be uploaded by PA/PG/ Bank in correct format as specified by ICCL. <_o3a_p>4) PA/ Bank shall submit the audit report to ICCL on a yearly basis aligning with the agreement with ICCL on or before the date communicated by ICCL via email. <_o3a_p>5) PA / PG/ Bank shall maintain reconciliation of funds transferred to ICCL and MIS uploaded and shall communicate and resolve in case of discrepancies. <_o3a_p>6) PA / Bank/ PG (either itself or through participating banks or facility providers) have no authority whatsoever to debit ICCL's Account against any adjustments. <_o3a_p>7) PA / PG / Bank shall report all the MIS to ICCL for unreported transactions as requested by ICCL. <_o3a_p>8) PA / PG / Bank shall resolve the queries/discrepancies raised by ICCL within 7 working days of transferring the funds to ICCL Accounts. <_o3a_p>

Fund Mapping:<_o3a_p>

Order Processing remains pending in case of mismatch between Funds Confirmation MIS and respective bank credits or orders received on Star MF platform. Key mismatch reasons for non-mapping of funds are mentioned below: <_o3a_p>

Ø Incorrect data received in the fund confirmation MIS uploaded by the PAs/PGs/ Banks.<_o3a_p>Ø Non-updation / delayed uploading of MIS by PAs/PGs/Banks.<_o3a_p>Ø Incorrect updation by Members while registering client details on BSE Star MF w.r.t. Bank account number, IFSC code etc.<_o3a_p>Ø Mismatch between amounts transferred to ICCL Account as against Funds confirmation MIS uploaded by PAs/ PGs/ Banks.<_o3a_p>Ø Fund Confirmation MIS uploaded by PAs/ PGs/ Banks has incorrect or insufficient details viz. UTR No, etc. causing mismatch in the corresponding bank credits.<_o3a_p>Ø Delayed response by Banks/NPCI regarding fund transferred by PAs/PGs/Banks to ICCL.<_o3a_p>

Members are requested to note that any MIS uploaded after cut off timings mentioned above/ any record having mismatch between Funds confirmation MIS uploaded by PAs/ PGs/ Banks and credit in ICCL's Accounts will get processed on best effort basis post applicable validations.<_o3a_p>

Mehul Parikh AshfaqueAli Kazi<_o3a_p>

Additional General Manager Deputy Manager<_o3a_p>

Mutual Fund Mutual Funds

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