It?s raining complaints from mutual fund investors. Ever since market regulator, Securities and Exchange Board of India (Sebi), had asked all the fund houses in May this year to disclose investor grievances on Amfi website, over 3.94 lakh complaints were found to have been received by the MF industry in 2009-10 alone. This essentially means that one out of every eight MF investors in the country had some complaints or the other during the period. While the most common grouse is on non-receipt of dividends and redemption proceeds, failure of fund houses to update personal details has also annoyed investors.
Fund houses like UTI MF, Birla Sun Life MF, ICICI Pru MF, Canara Robeco and Franklin Templeton received the largest number of complaints. Of course, if one were to look at complaint received per investor, Birla Sun life and Canara Robeco top the chart.
However, to the relief of investors, Association of Mutual funds in India (Affi) data shows that despite such high number of investor grievances, fund houses managed to resolve the problems within the 30 days of receipt of the complaint.
In total, the 39 fund houses received over 3.94 lakh complaints in 2009-10, of which approximately 3.79 lakh crore (96%) were resolved by them within 30 days of receiving the complaint, as per Amfi data.
UTI MF received highest number of complaints at 99,300 for the year followed by Birla Sun Life MF and ICICI Pru MF who received 95,400 and 57,600 complaints, respectively. Among large-sized fund houses, DSP Black Rock (731), HDFC MF (7,673), SBI (8,174) and Reliance MF (10,234) received relatively lesser complaints compared to their assets under management. Sanjay Sinha, CEO of L&T Mutual Fund, says, ?There has been quite a few complaints received on non-receipt of statement of account. However we feel that, as a percentage of total number of applications received the number will be a fraction of a percentage.? L&T MF received 377 complaints for the year.
Of the 3.94 lakh complaints, over 61,000 (16%) were for non-receipt of dividend and another 51,500 (13%) for non-receipt of redem-ption proceeds.
While 10% of complaints were for non-update of changes of address, PAN, bank details, nomination among others, another 8% was for non-receipt of account statements. Interestingly, the ?others? category of complaints comprising 48% of overall complaints received, remained a mystery as to its nature. While UTI and Birla Sun Life topped the charts for receiving maximum complains for non receipt of account statements it was UTI and ICICI Pru for non-receipt of redemption proceeds. ?Sometimes many investors don?t inform us about change in residential address which causes delay in delivering account statements and updation of changes in bank details, nominations and PAN,? said a senior official from a leading fund house on condition of anonymity. Sebi in May had asked all the fund houses to disclose investors complaints not only to Amfi, but also on their websites as well as in their annual reports. Sebi in its circular had stated that, ?We has received feedback from investors and Investors? Associations to improve transparency in the ?grievance redressal mechanism?. It is envisaged that transparency will also improve the general functioning of the market by providing investors the wherewithal to make an informed choice.?