Sebi allows deployment of unclaimed money in less risky debt funds
The unclaimed funds will be deployed only in those overnight, liquid, and money market funds that are placed in a relatively low-risk category.
The Securities and Exchange Board of India (Sebi) has relaxed the mutual fund norms by allowing to invest unclaimed dividends and redemption in the overnight scheme, money market, and liquid schemes, on the condition that the unclaimed money should be from that particular scheme.
The unclaimed investor money could earlier be parked only under the debt schemes category in the overnight funds.
The market regular has said that the amendment will come into force from December 1.
“The unclaimed funds will be deployed only in those overnight, liquid, and money market funds that are placed in a relatively low-risk category,” as per the amendment made in the Sebi circular.
The circular further pointed out that no permission will be granted to asset management companies (AMCs) to charge any exit load in such mutual fund plans that are specifically launched to allow the deployment of unclaimed amounts. The total expense ratio of such plan will be capped as per the direct plan of such scheme or at 50 basis points whichever is lower, Sebi said.
It also said that the instance access facility will be provided with immediate effect only in the overnight and liquid schemes.
Download Money9 App for the latest updates on Personal Finance.
