It is mandatory to renew your Legal Entity Identifier (LEI) code every year. If you do not do so, your LEI status will change from “ISSUED” to “LAPSED” on the GLEIF database, and once it is updated in the global database, there is no way to remove the history. With a lapsed LEI code, you cannot participate in forward-booking, auction-booking, hedging, or any kind of cross-border transaction.
Currently, there are 7,69,567 lapsed LEIs globally, taking almost 36 percent of registered LEIs to date.
Why do you need to keep your LEI active?
Once your LEI status is turned from green to red in the global index, it is impossible to mute it unless you do not renew. Here are some reasons why you need to keep your LEI code active.
‘No LEI, no trade’: Many businesses ensure that the company they are trading with has an LEI code. Some businesses or companies have a “no LEI, no trade” policy. In order to prove that, you must have an active LEI.
Immutable LEI record: Once your status on the Global Index changes to lapsed, it is impossible to change that record unless you renew it.
Trust: When your LEI code is active, it builds trust with cross-border clients.
Know the benefits of an LEI code here.
What are the consequences of a lapsed LEI?
In October 2020, Morgan Stanley was filed and charged $ 5 Million USD by the Commodity Futures Trading Commission(CFTC) for inaccurate swap reports and for allowing their LEI codes to lapse from 2013-2018. Therefore, lapsed LEI can cause you the risk of the non-convenience fee. It also impacts your financial transaction not only in the international market but also domestically. Whether it be a large loan or a small one, once your status LEI code lapses, it will take a lot of time to be approved by the financial institutions.
How to avoid letting your LEI become lapsed?
Your LEI code is valid for 12 months after issuing it. You can avoid letting your LEI lapse by applying for a renewal before the lapse date. The earliest you can apply for LEI renewal is 60 days before it lapses. It is better if you don’t wait for the lapse date as it takes 24 hours to renew an LEI code. Even if you made the renewal beforehand, the next renewal date would be the same day of your issuance. You can apply for a renewal of your LEI code here.
Renew your LEI code with LEI Kart.
With LEI Kart, renewing your LEI code is simple, easy, and cost-effective. Apply for your renewal today and get it done in a few hours. You can renew by following the steps below:
- Go to www.leikart.com and click LEI Renewal or directly click here.
- Insert your LEI code or your company’s name.
- Fill in the details as per your documents.
- Accept the “terms and conditions”, and click “confirm and continue”.
- Choose your renewal plan; LEI Kart provides a multi-year renewal plan, i.e., one year, three years, and five years.
- Add ‘LEI Certificate’. LEI Kart provides a free LEI certificate in pdf; you can also buy a hard copy of the same. Remember, the LEI certificate is totally optional, you can still have it for yourself.
- Lastly, Insert your GST Number for the invoice, choose the method of payment and proceed. LEI Kart accepts any kind of payment like UPI, bank transfer, NEFT, net banking, and card payment.
Relax and wait for our mail of confirmation. You can track your LEI status here.
Key Takeaways
- Your LEI code needs to be renewed every year.
- The status of your LEI in the global database will turn from “ISSUED’ to “LAPSED”.
- No LEI, no trade.
- Lapsed LEI may cause you the risk of the non-convenience fee.
- You can apply for your renewal 60 days before the lapse date.
- LEI Kart is one of the most cost-effective service providers in India.
- You can also transfer your service provider whenever you want.