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AMCs to discontinue dividend reinvestment option

Amfi wants the practice to stop due to the growing number of complaints during withdrawals

Mutual Fundr image via Shutterstock

With the tax-saving season under way, mutual funds (MFs) have started aggressively promoting their equity-linked savings schemes (ELSS). These get a benefit under the Section 80C limit of Rs 1.5 lakh.    However, investors are to no longer get the dividend reinvestment option. The Association of Mutual Funds in India (Amfi) has written a letter to asset management companies (AMCs) to stop offering this option.  The reason: Rising complaints during withdrawals. Fund houses already have Rs 36,257 crore in ELSS. The letter says investors often forget to tick the ...