AMFI is likely to approach SEBI to relax norms governing new cadre of distributors, said three people familiar with the development.
Among its key requests would be allowing new cadre of distributors to sell more product categories having some predefined features that are easy to understand and relaxation in the criteria to become new cadre of distributors.
A CEO of a private fund house told Cafemutual that AMFI would request SEBI allowing new cadre of distributors to sell ELSS, balanced advantage funds and equity savings funds as these funds are easy to understand. He further said, “Another key request would be implementation of captive distribution model for new cadre of distributors in which they can work exclusively with a fund house. This will encourage fund houses to on board and train new people to join mutual fund distribution business. ”
Another CEO of private fund house believes that SEBI should allow such distributors to sell liquid fund, ultra short term funds and ELSS. “I think MIPs, money market or accrual fixed income and tax saving funds should be allowed as these funds are easy to understand.”
Currently, new cadre of distributors can sell only diversified equity schemes, fixed maturity plans (FMPs) and index schemes, which have returns equal to or better than their scheme benchmark returns during each of the last three years.
An AMFI board member said that they would approach SEBI with these proposals soon. “There are some important suggestions from a few members. We will shortlist these suggestions and approach SEBI to relax norms governing distribution channel.”