Sebi panel meets to discuss MF changes

The seven-member panel on Mutual Funds (MF) headed by Sebi's (Securities and Exchange Board of India) whole-time member Prashant Saran met here today to discuss the “convergence of economic interest of the distributor, manufacturer and the investor.”

Two important issues on the agenda are a service fee in the range of Rs 100-150 per transaction for distributors and the common account statement.

According to panel members, the distributor community is moving away from the mutual fund industry affecting the growth of the industry. At around 73,000 Amfi registered agents, the mutual fund distribution force is already miniscule when compared to the 30-lakh strong insurance agents. And the deliberations of the committee are in the direction of keeping this force motivated.

Common account statement is an initiative proposed under Bhave's regime but is yet to be fully implemented. According to one of the members, the statement has practical difficulties and is not cost-effective. According to him, it would make mutual funds less competitive when compared to other financial products.

While industry is lobbying hard to get the reforms rolled back, Investors are against the reversal of these initiatives, which has made life simpler for them.