To further encourage investor awareness, market regulator Securities and Exchange Board of India (Sebi) is planning to build a corpus and address the issue of investor education in mutual funds. This will be for the first time that the market regulator will come out with such a huge investor education awareness initiative.
Officials connected with the development said this decision will be taken by the regulator in the next one month. “The issue has been pending since many months and the corpus will be raised by Sebi from the asset management companies. The corpus will be used only for the education in mutual funds throughout the country,” they said.
Currently, several big fund houses conduct investor education awareness programmes on their own.
“Sebi now plans to raise 0.01% of the asset under management (AUM) of every fund house. Other details such as when the amount will be collected and how it will be used will be chalked out by the Sebi in the coming days,” said a member of the mutual fund advisory committee.
According to the official, Sebi chairman CB Bhave has been extremely keen on kicking off this initiative and would also be looking at the details of the scheme.
The asset under management of 37 fund houses for the month ended November stood at over Rs 8.07 lakh crore, with AUM of Reliance and HDFC mutual funds being over the Rs 1 lakh crore mark. Speaking about this development, Sundeep Sikka, CEO of Reliance Mutual Fund, said, “We welcome any move by the regulator, which will facilitate investor education in any manner.”
Recently, the market regulator had said it has come to its notice that unwarranted hardship was being caused to investors in mutual fund schemes.
So the market regulator had announced that mutual fun investors can switch their distributors without obtaining a no-objection certificate (NOC) from existing distributors.