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SEBI releases consultation paper on proposed plan for Rs 250 SIP – market regulator SEBI invites comments on proposed plans for Rs 250 small ticket sip

Market regulator SEBI has issued a consultation paper seeking comments from people on its ‘Small Ticket Systematic Investment Plan’. This plan is widely discussed as a SIP of Rs 250. SEBI released a consultation paper in this regard on January 22. SEBI has proposed that small ticket SIP (SIP of Rs 250) can be limited to only 3 plans.

Players in the mutual fund industry have agreed to offer ‘discount rates’ so that asset management companies can break even sooner after incurring expenses on these investments. Asset management companies can offer SIPs in addition to these three smaller SIPs, but the discount rate will be limited to the first three SIPs only.

SEBI Chairperson Madhabi Puri Buch had said this month that SIP of Rs 250 will be launched soon, the aim of which is to promote financial inclusion. The market regulator has proposed that certain incentives and a part of the cost borne by asset management companies will be reimbursed from the Investor Education and Awareness Fund to promote penetration of SIPs by reducing the breakeven time.

According to SEBI’s proposal, the offer for small SIPs through stock exchanges, depositories, RTAs and KRAs will be limited to the first three small SIPs only. The proposed smaller format of mutual funds is aimed at promoting financial inclusion and ensuring flow of small savings into mutual funds.

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