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Mutual funds have to increasingly reach out to the masses for channelising savings into investments, said Ananta Barua, Executive Director, SEBI.
Barua was speaking at the launch of Computer Age Management Services (CAMS) mobility-enabled technology solutions for the mutual fund industry.
“Modalities have changed. Recently, the Pradhan Mantri Jan Dhan Yojana was launched and banks are going to the market. The message is clear. You have to reach out to the masses,” he said.
Referring to illegal collective investment schemes which raised thousands of crores and were proceeded against by SEBI, Barua said people have the money and the reasons why these entities were able to raise so much money was because they assured returns, gave high commissions to intermediaries and transacted in cash. This cannot be done by a mutual fund, he observed.
Mutual funds can receive cash of up to ₹50,000 from investors while redemptions have to be routed only through a bank account. “Only six mutual funds have collected cash and the amount is very low,” said Barua.
To overcome this, SEBI has stepped up investor awareness initiatives on mutual funds.
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