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Informist, Tuesday, Apr. 15, 2025

 

--SEBI ED Kumar: Trying to review entire regulation of mutual funds

--SEBI ED Kumar: Concerned about low penetration of mutual fund industry

--CONTEXT: Comments by SEBI ED Manoj Kumar at 18th CII Mutual Fund Summit

 

MUMBAI – Mutual fund guidelines are the most lengthiest guidelines and we are working to make them more comprehensive, said Manoj Kumar, executive director of the Securities and Exchange Board of India, at the 18th CII Mutual Fund Summit Tuesday. "We have come to notice that the mutual fund regulation is the lengthiest regulation out of all...all of us are trying to work (in that direction) so that we can bring the conducive ability of those on the ground," Kumar said. 

 

Commenting on regulation 24 (b) of SEBI (Mutual Funds) Regulations, 1996, Kumar said that it continued to pose a hurdle for the industry and SEBI was working to simplify it. The regulator has taken industry feedback on this and is reviewing the entire regulation to address operational issues and make it more effective. 

 

Regulation 24(b) of SEBI (Mutual Funds) Regulations, 1996 details the business activities that may be undertaken by asset managment companies. "Some re-examination has already started. For example, institutional mechanism, that had a very robust testing done before we launched it, and we are going to resolve whatever challenges are there in the institution," Kumar said.

 

Talking about the same, Nippon Life India Asset Management Ltd. Chief Executive Officer Sundeep Sikka said, "With the revisions in this regulation, we can expect a lot more foreign capital in the country which will be betyond the mutual fund business." Kumar said SEBI was shifting from a narrow, key regulatory-focused model to a more conducive and supportive one. "We will try to create an environment where we as a regulator work together with the industry," Kumar added. 

 

The new approach will be guided by four key pillars--transparency, trust, technology, and team spirit--laid out by SEBI Chairman Tuhin Kanta Pandey, said Kumar. He added that SEBI was not static and will continue to adapt based on feedback, focusing on market stability and industry growth.

 

Kumar said that the regulator was actively working on the norms for categorisation and nomenclature of mutual funds. "If we need mutual funds to be accessible to beyond-30 cities, then we need to make the names better understandable. We have requested AMFI to simplify the names."  End

 

Reported by Sachi Pandey and Kshipra Petkar

Edited by Akul Nishant Akhoury

 

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