SEBI chief U K Sinha today said that SEBI will hold discussions with other regulators like IRDA, PFRDA and the Ministry of Finance to see if the KYC done through KYC Registration Agency (KRA) could be made applicable across all products.
Mr U K Sinha said that SEBI is going to come out with distributor regulations soon. The SEBI chief also said that the regulator is working on product labeling in mutual funds. “We are also working towards product labeling. We are in consultation with the industry and the product labeling exercise is going on.”
Going a step further, the regulator wants to inform investor as to what percentage of sales of AMCs are routed through associate companies. Currently, many banks and financial institutions are sponsors of AMCs and many of the associate/group companies are engaged in distribution of mutual fund products. “One important area for financial advisors to look at when they are advising their clients is what percentage of assets of a particular AMC is distributed by their associate distributors. We have now mandated that this point has to be disclosed. I won’t say that this is wrong or good. But it is an important input for potential investors to know. That information should be available to investors.”
