Sebi tweaks debt fund norms for ensuring adequate corpus

Market regulator the Securities and Exchange Board of India (Sebi) introduced a minimum subscription amount criterion to ensure adequate assets under management (AUM) in debt fund schemes. “It has been observed that many debt-oriented schemes are operating with a very low AUM. In the interest of investors, it is important that debt-oriented schemes have an adequate corpus to ensure adherence to the investment objectives as stated in scheme information document…,” stated a Sebi circular issued on Friday.

For debt-oriented and balanced schemes, the minimum subscription amount at the time of the new fund offer has been fixed at Rs 20 crore and at Rs 10 crore for the other schemes.

Further, open-ended debt schemes will be required to maintain an average AUM of Rs 20 crore on a half-yearly rolling basis. Existing open-ended debt fund schemes are expected to comply with the norm within the next one-year period.