SEBI will soon come out with a long-term policy for mutual funds which will try to establish the role and purpose of mutual funds, said U K Sinha while addressing a gathering at SBI Mutual Fund’s opening ceremony of 51 branches. He said that SEBI will take up this policy for approval in its next board meeting.
“Products like insurance and pension have certain understanding and positioning in the minds of the investor as well as in the minds of the government. In five decades since the setup of first mutual fund in 1964, the industry has perhaps lost its focus. There is a need to refocus on the role which mutual funds can play. SEBI will come out with a long-term mutual fund policy soon. This will help in the growth of the industry,” said U K Sinha.
SEBI is working on a couple of areas. Apart from a mutual fund policy, the regulator is also in consultation with industry players to introduce real estate mutual funds. “No real estate scheme has been launched so far. We have received some representations. We are looking into areas where changes are required so that these funds can be launched,” he said.
SEBI is also going to consult industry players to make Rajiv Gandhi Equity Savings Scheme (RGESS) more popular. The complex structure of RGESS has discouraged AMCs to launch RGESS. Last year only six fund houses had launched RGESS which collected close to Rs. 230 crore. Only four fund houses including two new entrants are planning to launch RGESS this year. “We are going to engage with the industry to find out what are the problems. If there are anything required which involves the government we propose to take up the matter with government after consulting the industry,” he said.
He pointed out the fall in retail assets and stagnant growth of the industry in the last one year and said that SEBI is willing to help AMCs if they meet SEBI’s expectations.
