Mutual funds (MFs) are worried that the collapse of six debt schemes of Franklin Templeton India will set off a redemptions crisis in the nation’s asset management industry.
Asset managers are marking down bad investments, seeking bank loans and a liquidity intervention from the Reserve Bank of India (RBI) to contain the fallout of large redemptions. As of 23 April, four fund houses had borrowed ₹4,427.68 crore from banks to manage redemption pressure, according to Association of Mutual Funds in India, or Amfi.
