Explore Business Standard
Markets regulator Sebi has amended mutual fund rules asking asset management companies (AMCs) to deploy the money collected from investors through New Fund Offers (NFOs) in a prescribed time limit. Additionally, the regulator has mandated disclosure of stress testing for mutual fund schemes to provide greater transparency to investors. These measures, to be implemented from April 1, 2025, are aimed at enhancing operational flexibility for mutual funds while ensuring greater accountability and trust among investors. Regarding deployment timelines, Sebi, in a notification dated February 14 said, "The scheme shall deploy the funds received in the new fund offer within the time period as may be specified by the Board from time to time." This came after the board of Sebi approved a proposal in December asking fund managers to deploy funds collected during an NFO as per the specified asset allocation of the scheme, typically within 30 days. If funds are not deployed within the specified