SEBI has by way of its Circular dated December 11, 2023 specified the following guidelines and timelines for credit of units of Alternative Investment Funds (‘AIFs’) in dematerialised form:

i.    Managers of AIFs to continue to reach out to existing investors to obtain their demat account details and credit the units issued to them to their respective demat accounts;

ii.   Units already issued to existing investors who have not provided their demat account details, to be credited to a separate demat account named ‘Aggregate Escrow Demat Account’. New demat units issued to such investors to be credited to such an account;

iii.  Once investors’ demat account details are obtained, their units held in Aggregate Escrow Demat Account to be transferred to the investors’ demat accounts within five working days; and

iv.   Managers of AIFs to maintain investor wise Know Your Consumer (‘KYC’) details of units held in Aggregate Escrow Demat Account and report the same to depositories and custodians on a monthly basis.

v.    For schemes with corpus of ₹ 500 crore (approx. US$ 60 million) or more as on October 31, 2023: (a) with respect to investors who have provided their demat account details, any units issued post October 31, 2023 to be in demat form and credited only to investor’s demat accounts; (b) for investors who have not provided their demat account details and who were on-boarded prior to November 01, 2023, their units to be temporarily credited in the Aggregate Escrow Demat Account, till investor’s demat account details are obtained; and (c) credit of demat units for both situations (a) and (b) of this paragraph to be completed by January 31, 2024.

vi.   For schemes with corpus less than ₹ 500 crore (approx. US$ 60 million) as on October 31, 2023, and schemes launched after October 31, 2023 (irrespective of corpus): (x) with respect to investors who have provided their demat account details, any units issued post April 30, 2024 to be in demat form and credited only to investor’s demat accounts; (y) for investors who have not provided their demat account details and who were on-boarded prior to May 01, 2024, their units to be temporarily credited in the Aggregate Escrow Demat Account, till investor’s demat account details are obtained; and (z) credit of demat units for both situations (x) and (y) of this paragraph to be completed by May 10, 2024.