India's leading stock exchange BSE Ltd's joint venture (JV) with US based insurance exchange Ebix will seek approval from the Indian insurance regulator for rolling out of its insurance distribution venture, the BSE chief said here on Saturday.
"We have tied up with Ebix, a US based insurance exchange and we have taken permission from Securities Exchange Board of India (Sebi) for setting up a subsidiary for the insurance distribution. In fact, we have formed a joint venture with Ebix and the JV company is in the process of preparing application for seeking approval from Insurance Regulatory Development Authority of India (IRDAI)," BSE's MD and CEO Ashish Kumar Chauhan said.
While BSE and Ebix will hold 40 per cent each in the JV company, the rest 20 per cent will be held by individuals and the company will eventually be called BSE-Ebix Insurance Broking, he said, on the sidelines of the Fintech Forum organised by the Merchants' Chamber of Commerce and Industry here.
The JV company will leverage the physical infrastructure of BSE and the technology platform of Ebix, he said.
Chauhan also said the stock exchanges were largely focusing more on "speculation" rather than investment products over the last 20 years.
After the success of distribution of investment products like mutual fund schemes, it realised that there was a huge demand for investment products, he said, adding that the exchange started distribution of mutual funds in 2010 and it is now looking at the distribution of other financial products.
Presently, close to 20 per cent of the investments flowing into mutual funds are routed through the bourse, he said.
"About 30-40 per cent of the new money or fresh investments flowing into mutual funds are coming in through our platform," Chauhan said.
He also said BSE is expected to launch trading platform in the commodity from October 1, as mandated by the Sebi.
Sebi, in December last year, had approved the convergence of stock and commodity trading platforms starting October 1, 2018 and for which, the BSE has applied to the Sebi for launching of trading in commodities.
"We have been ready for trading in commodities for the last three years. As and when it is allowed, hopefully from October 1, we will be able to (launch) trade in commodities," he added.
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