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MF News Now your clients can send money to their immediate family through SWP

Now your clients can send money to their immediate family through SWP

Investors can make regular payouts from their own mutual fund investments to meet the needs of their immediate family through SBI MF’s Bandhan SWP.
Team Cafemutual Feb 8, 2018

SBI Mutual Fund today introduced a new facility called Bandhan SWP through which your clients can send monthly cash flows from their mutual fund investments to their immediate family member.

This is a facility offered to both new and existing SBI Mutual Fund investors to withdraw a specified sum of money on a periodic basis, from their own investment in a growth option of an open-ended mutual fund scheme. A new investor needs to first invest in a SBI Mutual Fund scheme and then opt for this facility. The beneficiary, can be the investor’s spouse, parent, child or sibling; also the beneficiary has to be a resident individual only, and not hold an NRI status.

Bandhan SWP defines the relationship between a Responsible Giver (Investor) and a Confident Receiver (Beneficiary). It facilitates a regular pay out which the beneficiary can use for monthly sustenance, additional financial support, lifestyle maintenance or recurring expenses.

Anuradha Rao, Managing Director & CEO, SBI Mutual Fund said, “With Bandhan SWP, we are reinforcing the value proposition which an SWP provides. We believe that using one’s own investment corpus to create a tax efficient and regular payout to immediate family members not only provides the financial support to your loved ones but also makes them confident and financially secure. In fact, SWP is the most tax efficient solution for individuals in the current tax regime’’

Explaining Bandhan SWP, DP Singh, Executive Director & CMO, said, “Bandhan SWP is ‘gifting ka naya nazariya’ for gifting within the family. It is about expressing the strength of relationships through financial independence.  The facility can be used extremely well by middle aged investors and those approaching retirement. A son / daughter can opt for Bandhan SWP for parents who might need an additional and regular cash flow to maintain and enhance current lifestyle comfortably. As an individual approaching retirement you can choose to start Bandhan SWP from your retirement corpus to create a regular stream of monthly cash flows for your spouse for household expenses or provide for pocket expenses for a child going to college in a different city.’’

Speaking on the launch, Navneet Munot, ED & CIO said, ‘’As a responsible fund house, our endeavor is to bring a behavioral change amongst investors to move from a short-term approach to a wealth creation mindset with a long term orientation, and Bandhan SWP is a step in that direction.’’

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3 Comments
Karan · 6 months ago
It is clearly Third Party Payment. With what logic SEBI has approved it? If this is possible then SEBI should allow redemption to bank accounts of immediate relatives also.
Jegadeeswaran · 6 months ago
What about the taxation.
Receiver hasn't invested but getting money , does the investor have option to book loss ?
Mangesh · 6 months ago
in this case, does sender is going to pay LTCG, or it is tax free ? How gift tax certificate is created in this transaction ? Does the money received is considered as income or Tax free under Goft tax clause ? If some body knows the answer, pl. clarify.
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