SEBI chief asks for feedback on instant redemption, e-wallet facility

In a bid to bridge communication between the market overseer and the stakeholders, SEBI chairman Ajay Tyagi, asked the fund houses, distributors and the investors of the industry to provide their feedbacks on the facility of instant withdrawal as well as e-wallet transaction at an event in Mumbai.   

The chairman also took the opportunity to put focus on the fresh facilities introduced by SEBI including the facility of instant redemption with a purpose to make the redemption procedure more convenient and e-wallet transaction in mutual funds. Tyagi also affirmed that the market regulator is looking to closely evaluate the progress of the new facilities.   

SEBI had granted its permission to the fund houses to provide instant redemption in liquid funds in the month of April 2017. However, the permission came with a limit on the redemption, the limit is of Rs 50,000 or 90 per cent of the folio value, whichever of the two is lower on such redemptions.    

The market regulator had also allowed the fund houses to facilitate transaction of up to Rs 50,000 in mutul funds through e-wallets or digital wallets. The e-wallets are online pre-paid account that is used to recharge mobiles, buy movie tickets or make any other online monetary transaction, for example, Paytm, Bhim, Pay U Money, etc.    

While most of the fund houses have enabled e-payments through wallets such as Unified Payment interface (UPI), transaction through Paytm, Pay U Money and alike are yet to gain access and popularity for mutual fund transactions.