SEBI new norms on MFs' intraday borrowing effective Jul 15 vs Apr 1 earlier
This story was originally published at 18:36 IST on 25 March 2026
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MUMBAI – The Securities and Exchange Board of India on Wednesday changed the effective date of the new norms for mutual funds' intraday borrowing to Jul. 15 from Apr. 1 earlier, the regulator said in a circular. The regulator has postponed the effective date due to operational challenges raised by the asset management companies.
The regulator on Mar. 13 said the amount of intraday borrowings by mutual funds should not exceed the guaranteed receivables due on the same day from the Reserve Bank of India, the government, and the Clearing Corp. of India. Mutual funds tap into intraday borrowing largely to repay redemptions from liquid or overnight schemes, where the withdrawals are settled earlier in the day than mutual funds can receive the maturity proceeds from money markets.
Earlier, intraday borrowings by mutual funds for above mentioned purposes were capped at 20% of net assets of a scheme. The duration of such borrowings were capped at six months. SEBI, earlier this month, said the limit of 20% is now not applicable for intraday borrowings and the limit should be specified by the board and uploaded on the company's website. End
Reported by J. Navya Sruthi
Edited by Deepshikha Bhardwaj
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