One of the largest distributors of direct plans in mutual funds, Zerodha Broking has applied for the mutual fund license..
The SEBI website shows that Zerodha Broking has applied for MF license on February 5, 2020.
The other two companies who had shown their interest in MF business were SREI and Frontline Capital Services. While SREI applied for license on December 04, 2019, Frontline Capital Services submitted its application on August 03, 2017.
Last year, Karvy Stock Broking applied with SEBI for MF license but the market regulator has kept it on hold due to pending regulatory action.
Earlier this year, SEBI has given in-principle approval to NJ India to set up its AMC business. Last year, it gave go ahead to Samco Securities. Both the companies will come out with their MF schemes this year.
SEBI rules say that the sponsor applying for a mutual fund licence is required to be in the financial services business for five years and needs to have a positive net worth for five years. The sponsor should have earned profits in three of the previous five years, including the latest year. SEBI conducts an on-site due diligence of sponsors before granting approval.
