The regulator wants MFs to create a framework for empanelling corporate distributors
Mumbai: National distributors are under SEBI’s radar. The mutual fund advisory committee had last year discussed putting in place guidelines for national distributors.
“We will do it in stages. The next step would be to put in place a framework for empanelling distributors. Funnily, today the distributor empanels the mutual fund, especially the corporate distributors (banks or national distributor). We want this to change. We want the fund to empanel distributors and we want the fund to lay out the criteria. So that would be the next set of changes to happen. Corporate distributors are not too many but they constitute a significant portion of the volume,” said K N Vaidyanthan Executive Director, SEBI on the sidelines of a recently held ICRA award function. Currently distributors are not under the regulatory purview of SEBI.
Inflows unaffected
He reiterated that the entry load ban has not affected the gross inflows in mutual funds and the sudden ban on entry load was a step in right direction which has helped the investors and the asset management companies. He also ruled out any possibilities of bringing back entry load saying that it’s a ‘closed chapter’. “If you have to a good thing (entry load ban) then do it,” added Vaidyanthan. According to him the industry is witnessing an average Rs 5,300 crore inflows per month since the regulator abolished entry load.
Connect with investors
The regulator is laying more emphasis on educating investors through awareness camps by asking AMCs to plough back a part of their profits in such campaigns. AMCs have so far conducted over 4,000 investor awareness camps across India.
Further, it wants AMCs to improve and fast track their investor grievance redressal mechanism. Fund houses were asked by SEBI to disclose investor redressal details on the AMFI website last year. SEBI has apparently taken a serious cognizance of these complaints.
