Retired government officials, teachers and bank officers would be able to sell mutual fund schemes from next month as part of market regulator Sebi's efforts to expand investors base in these products.
Among other, the new cadre of distributors would include postal agents and semi-government officials with a service of at least 10 years.
These people can sell units of simple and performing mutual fund schemes and would require a simplified form of National Institute of Securities Markets (NISM) certification and Association of Mutual Funds in India (AMFI) registration.
Apart from that Sebi has announced implementation of a number of steps for the benefit of mutual fund industry, including an additional levy on investors for catering to smaller cities, the regulator said in a circular issued yesterday.
As per the proposals approved by Sebi's board on August 16, the Securities and Exchange Board of India (Sebi) said, a number of steps are being taken to increase the penetration of MF and to energise the distribution network while protecting the interest of investors.
Among the measures announced, the MFs can charge up to 30 percentage points of additional TER (Total Expense Ratio) – a fee charged to investors for MF investments under fund management and other heads -- if the new inflows from beyond top 15 cities are at least 30 per cent of gross new inflows in the scheme or 15 per cent of the average assets under management (year to date), whichever is higher.
The top 15 cities would be decided on the basis of data compiled by the AMFI data for 'AUM by Geography - Consolidated Data for Mutual Fund Industry' as at the end of the previous financial year.
MFs would need to make complete disclosures in their half yearly report to Sebi regarding the efforts to increase geographical penetration and the details of opening of new branches, especially those beyond top 15 cities.
In another step, Sebi has allowed MFs to charge service tax on investment and advisory fees to the scheme.
Also, MFs have been asked to launch schemes under a single plan and ensure that all new investors are subject to single