Sebi tweaks investor charter for investment advisers, research analysts to boost financial literacy

Markets regulator Sebi on Monday tweaked the investor charter for investment advisers and research analysts to enhance financial inclusion and financial literacy.
Tired of too many ads?
Remove Ads
Tired of too many ads?
Remove Ads
Markets regulator Sebi on Monday tweaked the investor charter for investment advisers and research analysts to enhance financial inclusion and financial literacy This came in view of the recent developments in the securities market, including the introduction of the Online Dispute Resolution (ODR) platform and SCORES 2.0 -- a web-based centralised grievance redressal system of Sebi.The modified charter includes vision, mission, services provided to investors and details of business transacted by investment advisers (IAs) /research analysts with respect to their investors, according to separate circulars.Additionally, it includes rights and responsibilities of investors; details of redressal mechanism available to investors and how to access it, along with formats for investors complaints data to be disclosed monthly by IAs and RAs on their website and mobile applications and trend of annual disposal of complaints.The markets regulator has investment advisers and research analysts to bring the investor charter to the notice of their clients (existing as well as new clients) by disclosing the charter on their respective websites and mobile applications.Also, they have been asked to make the charter available at prominent places in the office and provide a copy of the charter as a part of the client onboarding process, through e-mails or letters etc.To ensure transparency in the Investor Grievance Redressal Mechanism, all IAs and RAs will continue to disclose on their respective websites and mobile applications the data on complaints received against them or against issues dealt by them and redressal thereof, latest by the 7th of the succeeding month in a prescribed format, Sebi said.Sebi, in December 2021, issued an investor charter for IAs and RAs detailing the services provided to investors and, the rights of investors, among others.This was aimed at facilitating investor awareness about various activities which an investor deals with, such as the opening of an account, KYC and in-person verification, complaint resolution, issuance of contract notes and various statements.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

Time of India

an hour ago

• Time of India

SIF vs mutual funds vs PMS vs AIFs: What you need to know

Looking for the best mutual funds to invest? Here are our recommendations. Mutual Funds (MFs) Mutual Funds are pooled investment vehicles regulated heavily by SEBI. They cater to retail investors and allow exposure to a broad set of asset classes such as equity, debt, and hybrid combinations. Key traits of Mutual Funds: Low entry barriers (SIPs can start at ₹500) Highly liquid with daily NAVs and redemption flexibility Standardised investment strategy (equity, debt, hybrid) Ideal for passive investors seeking low-to-moderate risk But their mass appeal also comes with limits — restricted customisation, fewer complex strategies, and a one-size-fits-most approach. Portfolio Management Services (PMS) PMS offerings are aimed at affluent investors looking for personalised strategies. They provide discretionary or advisory services for portfolios, usually managed by experienced fund managers. Highlights: Minimum ticket size: Rs 50 lakh High degree of personalisation based on goals and risk appetite Actively managed and bespoke asset allocation Lower liquidity than mutual funds Higher costs (including management and performance fees) Alternative Investment Funds (AIFs) – The High-Risk, High-Reward Engine AIFs are pooled investments operating in less-regulated, non-traditional spaces. This includes private equity, hedge funds, structured debt, and real estate. Key features: Minimum investment: Rs 1 crore Three categories: Category I (social impact, infra), Category II (private equity, debt), Category III (hedge funds) Less liquidity due to long lock-in periods Lower regulatory oversight Ideal for HNIs and institutional investors with higher risk tolerance While they offer unparalleled exposure to niche assets, the complexity and high barriers make AIFs inaccessible for most retail investors. Where do SIFs fit in? SIFs aim to bridge the structured simplicity of mutual funds with the customisation of PMS and the sophistication of AIFs. They allow fund managers more flexibility in asset selection — including unlisted securities, real estate, and structured debt — while operating under a stricter regulatory framework than AIFs. Structure and regulatory oversight SIFs follow SEBI-mandated norms for transparency, liquidity, and diversification. Unlike AIFs — which are largely unregulated in how they allocate capital — SIFs must: Adhere to strict portfolio disclosures Offer SIP/SWP options Stick to a single strategy category (equity, debt, or hybrid) per fund This ensures greater accountability and clarity for investors. Furthermore, the minimum investment threshold for SIFs is ₹10 lakh, striking a middle ground between mutual funds and PMS/AIFs. This makes them suitable for experienced investors who may not yet qualify as HNIs. Liquidity and tenure Liquidity is one of the core differentiators. Mutual Funds: Daily NAVs, instant redemptions PMS: Periodic exits, subject to portfolio's nature AIFs: Multi-year lock-ins; highly illiquid SIFs: Moderate liquidity — can be open-ended, closed-ended, or interval-based Investment flexibility and strategic depth Redemption periods for SIFs can extend up to 15 working days, allowing fund managers to manage liquidity prudently. SIFs are allowed to operate only one strategy per fund — either: Equity-oriented Debt-oriented Hybrid While this is limited compared to PMS or AIFs, it provides clarity and focus. This also prevents over-diversification within a single fund, which can dilute returns and increase risk unpredictability. Conclusion Specialised Investment Funds are a welcome innovation in India's investment universe. They offer a tailored investment approach for affluent and informed investors who seek: More flexibility than mutual funds Lower entry barriers than PMS or AIFs And a regulated, strategy-driven structure that balances control and innovation As Indian investors become more financially literate and seek nuanced products beyond vanilla funds, SIFs could become the new middle path, offering risk-calibrated sophistication for the next generation of wealth creators. (The author Chakravarthy V. is Cofounder & Executive Director, Prime Wealth Finserv. Views are own) (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)

The Hindu

15 hours ago

• The Hindu

Plans to make mutual fund rules more investor and industry friendly: SEBI official

The Securities and Exchange Board of India (SEBI) is undertaking a comprehensive review of mutual fund regulations to make them more investor-centric and industry-friendly, a senior official said on Saturday (June 21, 2025). "We are reviewing the entire mutual fund regulatory framework to enhance ease of doing business for all stakeholders, including the regulator," SEBI executive director Manoj Kumar said at the 17th Mutual Fund Summit organised by the Indian Chamber of Commerce (ICC) here. Existing regulations governing the sector are among the lengthiest and require simplification to keep pace with evolving investor needs and industry innovations, stakeholders said. "The process has started and soon we will come out with draft regulations for feedback and consultation process before it is finalised," Kumar said without giving any timeline for the rollout of the new rules. Kumar outlined the regulator's strategic roadmap to strengthen India's securities market, with mutual funds positioned as a critical pillar in fostering inclusive financial growth and investor protection. A consultation paper on regulations which governs advisory functions in mutual funds is also in the pipeline. Addressing the event, Kumar said India has undergone major market transformations under SEBI's stewardship. These include the shift to an electronic trading ecosystem in 1998, followed by achieving 100 per cent dematerialisation of shares, making India the only jurisdiction globally to do so. "The third transformation is unfolding now through the mutual fund revolution," he said, calling it a cornerstone of SEBI's "optimum regulation" approach, one that seeks balance among the interests of the regulator, the industry, and investors. While India's mutual fund industry has crossed Rs 72 lakh-crore in AUM and monthly SIP contributions have touched Rs 28,000 crore, the investor base remains limited to just five crore in a population of 140 crore, Kumar pointed out. SEBI is also actively reviewing scheme categorisation norms to make them more intuitive for investors, while ensuring all offerings remain "true to label" to prevent mis-selling. To offer wider choice to investors, SEBI has approved a new product category, referred to as SIF, aimed at investors with ticket sizes between Rs 10 lakh and Rs 50 lakh. Mutual funds were selected to manage these products given their established governance and handling of retail flows. Parallelly, SEBI has opened faster registration windows for Portfolio Management Services (PMS) and Alternative Investment Funds (AIF) with similar offerings. Addressing industry concerns over stress test disclosures for mid- and small-cap funds, Kumar reaffirmed SEBI's disclosure-based regulatory model, stressing that informed investors are central to market resilience. While he acknowledged that some disclosure requirements may seem burdensome, he assured stakeholders that SEBI remains open to feedback and streamlining processes. He urged the industry to avoid situations that warrant regulatory intervention, saying, "Our goal is not to disrupt but to allow business to thrive." Highlighting the untapped potential in eastern India, Kumar said SEBI views West Bengal and the Northeast as strategic regions for mutual fund expansion, underscoring the need for targeted penetration efforts. Echoing this vision, AMFI chief executive V N Chalasani said India is transitioning from financial inclusion to financial well-being, where saving smartly and investing wisely will enable sustainable wealth creation. He cited the exponential growth of mutual funds post-2017, following SEBI's investor education mandate, which helped expand the investor base and improve financial awareness. However, Chalasani pointed out that India's mutual fund AUM still forms only about 20 per cent of GDP, compared to a global average of 65 per cent. He stressed the need for deeper financial literacy, especially in Tier 3 and 4 cities, where AMFI is focusing through school and university programmes, distributor expansion via India Post, and new product innovations aimed at mid-income investors. "Every Indian can evolve from a saver to an investor and ultimately a wealth creator," he said, calling for sustained collaboration between regulators, industry, educators and investors to build an empowered, financially resilient India.

Business Standard

17 hours ago

• Business Standard

Sebi plans overhaul of mutual fund rules to aid investors and industry

The Securities and Exchange Board of India (SEBI) is undertaking a comprehensive review of mutual fund regulations to make them more investor-centric and industry-friendly, a senior official said on Saturday. "We are reviewing the entire mutual fund regulatory framework to enhance ease of doing business for all stakeholders, including the regulator," SEBI executive director Manoj Kumar said at the 17th Mutual Fund Summit organised by the Indian Chamber of Commerce (ICC) here. Existing regulations governing the sector are among the lengthiest and require simplification to keep pace with evolving investor needs and industry innovations, stakeholders said. "The process has started and soon we will come out with draft regulations for feedback and consultation process before it is finalised," Kumar said without giving any timeline for the rollout of the new rules. Kumar outlined the regulator's strategic roadmap to strengthen India's securities market, with mutual funds positioned as a critical pillar in fostering inclusive financial growth and investor protection. A consultation paper on regulations which governs advisory functions in mutual funds is also in the pipeline. Addressing the event, Kumar said India has undergone major market transformations under SEBI's stewardship. These include the shift to an electronic trading ecosystem in 1998, followed by achieving 100 per cent dematerialisation of shares, making India the only jurisdiction globally to do so. "The third transformation is unfolding now through the mutual fund revolution," he said, calling it a cornerstone of SEBI's "optimum regulation" approach, one that seeks balance among the interests of the regulator, the industry, and investors. While India's mutual fund industry has crossed Rs 72 lakh-crore in AUM and monthly SIP contributions have touched Rs 28,000 crore, the investor base remains limited to just five crore in a population of 140 crore, Kumar pointed out. SEBI is also actively reviewing scheme categorisation norms to make them more intuitive for investors, while ensuring all offerings remain "true to label" to prevent mis-selling. To offer wider choice to investors, SEBI has approved a new product category, referred to as SIF, aimed at investors with ticket sizes between Rs 10 lakh and Rs 50 lakh. Mutual funds were selected to manage these products given their established governance and handling of retail flows. Parallelly, SEBI has opened faster registration windows for Portfolio Management Services (PMS) and Alternative Investment Funds (AIF) with similar offerings. Addressing industry concerns over stress test disclosures for mid- and small-cap funds, Kumar reaffirmed SEBI's disclosure-based regulatory model, stressing that informed investors are central to market resilience. While he acknowledged that some disclosure requirements may seem burdensome, he assured stakeholders that SEBI remains open to feedback and streamlining processes. He urged the industry to avoid situations that warrant regulatory intervention, saying, "Our goal is not to disrupt but to allow business to thrive." Highlighting the untapped potential in eastern India, Kumar said SEBI views West Bengal and the Northeast as strategic regions for mutual fund expansion, underscoring the need for targeted penetration efforts. Echoing this vision, AMFI chief executive V N Chalasani said India is transitioning from financial inclusion to financial well-being, where saving smartly and investing wisely will enable sustainable wealth creation. He cited the exponential growth of mutual funds post-2017, following SEBI's investor education mandate, which helped expand the investor base and improve financial awareness. However, Chalasani pointed out that India's mutual fund AUM still forms only about 20 per cent of GDP, compared to a global average of 65 per cent. He stressed the need for deeper financial literacy, especially in Tier 3 and 4 cities, where AMFI is focusing through school and university programmes, distributor expansion via India Post, and new product innovations aimed at mid-income investors. "Every Indian can evolve from a saver to an investor and ultimately a wealth creator," he said, calling for sustained collaboration between regulators, industry, educators and investors to build an empowered, financially resilient India.