In a bid to reduce compliance requirements and foster innovation in the mutual fund industry, the Securities and Exchange Board of India (SEBI) has proposed a relaxed regulatory framework for passively managed mutual fund (MF) schemes. The proposed framework, called MF Lite Regulations, aims to encourage competition and promote ease of entry for MFs interested in launching only passive schemes, such as Exchange Traded Funds (ETFs) and Index funds [b045f95b].
The MF Lite Regulations seek to streamline the compliance process for MFs managing only passive schemes. By reducing the regulatory burden, SEBI hopes to create a more conducive environment for innovation and competition in the industry. The proposed framework is expected to attract more players to the market and promote the growth of passive investment options [b045f95b].
SEBI's move to relax regulations for passively managed mutual fund schemes aligns with its broader efforts to simplify compliance requirements and promote ease of doing business in the financial sector. The proposal is open for public comments until July 22, allowing stakeholders to provide feedback and suggestions on the proposed framework [b045f95b].
Overall, the proposed MF Lite Regulations aim to create a more favorable environment for passive mutual fund schemes, reduce compliance burdens, and encourage innovation and competition in the industry. If implemented, these regulations could have a significant impact on the mutual fund landscape in India [b045f95b].
