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Sebi said many debt-oriented schemes are operating with very low assets under management, or AUM and in the interest of investors, “it is important that debt-oriented schemes have an adequate corpus to ensure adherence to the investment objectives. Photo: Abhijit Bhatlekar/Mint
Sebi said many debt-oriented schemes are operating with very low assets under management, or AUM and in the interest of investors, “it is important that debt-oriented schemes have an adequate corpus to ensure adherence to the investment objectives. Photo: Abhijit Bhatlekar/Mint

Sebi sets minimum asset limit for debt MF schemes

Debt-oriented and balanced MF schemes directed to have a minimum subscription amount of `20 crore at the time of new fund offer

Mumbai: The Securities and Exchange Board of India, or Sebi, on Friday directed all debt-oriented and balanced mutual fund schemes to have a minimum subscription amount of 20 crore at the time of a new fund offer (NFO). For other schemes, the minimum subscription requirement will be 10 crore.

Sebi said many debt-oriented schemes are operating with very low assets under management, or AUM. “In the interest of investors, it is important that debt-oriented schemes have an adequate corpus to ensure adherence to the investment objectives...," said Sebi.

Additionally, an average AUM of 20 crore on a half-yearly rolling basis has to be maintained for open-ended debt-oriented schemes.

Existing open-ended debt-oriented schemes will be given a year to comply with this norm.

If any open-ended debt scheme happens to be in breach of the latest norms, asset management companies, or AMCs, will be given six months to scale up their assets for compliance.

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