Performance linked incentive for MF under Sebi review

“Under-review performance linked incentives will garner further investments as mutual fund industry already ensures productive utilisation of savings,” said Barua, at a mutual fund summit organize by Confederation of Indian Industry (CII) in Mumbai. 

“SEBI is working on building a new improved and inclusive framework of B30 incentives which will be far more superior,” said Manoj Kumar, Executive Director, SEBI at the summit. 

A CII-CAMS report released on Mutual Fund Industry highlighted that millennial investors are the driving force of the Mutual Fund industry in India with over 85 lakh new millennials joining the mutual fund industry in FY19-FY23.   

“Mutual fund products ensure transparency, uniform treatment of unit holders and uniform applicability of Net Asset Value,” he added. 

Kumar mentioned that as a regulator SEBI needs to constantly fine-tune and become more collaborative in nature. Technology adoption and becoming data driven are the key focus areas being explored with each department of SEBI having a technology vertical, the work on new and improved B30 incentives framework is ongoing, he pointed out. 

“Indian Financial Industry is better placed in terms of best practices with SEBI working on building a more inclusive model,” he added.  

A larger push from the state towards financial inclusion and retail participation in the markets is expected to drive demand for Mutual Fund products. These two factors together will drive Assets Under Management (AUM) growth across asset classes over the next few years, said Sundeep Sikka, Chairman, CII WR Taskforce on Banking & Finance; CII Mutual Fund Summit & Executive Director and Chief Executive Officer, Nippon Life India Asset Management.