Jayshree Pyasi reports that while the IFAs welcome this
proposal, it will take some more time for the creation of an ombudsman body.
During the Seventh CII Mutual Fund Summit,
AMFI announced that an independent ombudsman body is being considered to look
into consumer grievances. Ombudsman is a body that acts as a trusted
intermediary between an organization and some internal or external constituency
while representing the broad scope of constituent interests.
“Nothing has been finalized on the
formation of ombudsman. The ombudsman body is on the radar of AMFI and a
proposal for the same has been presented to SEBI,” says an official wishing
anonymity.
The insurance sector has had a
functional ombudsman body since 1998 for the purpose of quick disposal of the
grievances of the insured customers and to mitigate their problems involved in
redressal of those grievances. Compared to insurance, the recognition of the
need for an ombudsman in MF industry has come late and according to industry
reports it will be a while before any such ombudsman body is formed.
“Making an ombudsman is like making a
lokpal bill for the MF industry. It would require a lot of time, decision and
effort for any concrete steps in the direction,” says an industry expert.
Meanwhile, the IFA fraternity has welcomed
the idea of an ombudsman.
“Making an ombudsman is a welcome
step. The problems an SRO cannot solve could be resolved by an ombudsman.
Instead of going to a regular court for redressal, an investor will have an
option. As an ombudsman redresses grievances in a defined time frame, having an
ombudsman is a very good idea,” says Suresh Sadagopan, founder, Ladder7 Financial Services.
Ashwin Vajani, an IFA shares similar
sentiments and says, “Ombudsman would be helpful in generating a greater degree
of trust amongst investors in relation to financial planners and advisors. The
presence of an industry watchdog would encourage better and ethical dealings.”
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your views on the relevance of an ombudsman for the mutual fund industry.
