Sebi's Madhabi Buch: Rs 250 SIP Coming Soon, Less Than a Starbucks Coffee
SEBI Chairperson Madhabi Puri Buch announced that India may soon witness the launch of a Rs 250 per month systematic investment plan (SIP), designed to enhance financial inclusion for a wider segment of the population. During a CII event, Buch shared that this initiative, developed in partnership with the mutual fund industry, aims not only to provide an affordable investment option but also to utilize technology for more efficient onboarding and servicing processes.
She explained that the industry has been in discussions with the Association of Mutual Funds in India (AMFI) and key players in the sector to ensure the viability of this initiative. "We have been working very closely to make sure that's viable for them. It can be offered, but if it's not viable, it will not get the traction", Buch said.
Aditya Birla Sun Life Mutual Fund is said to be at the forefront of creating this Rs 250 SIP, which would be a pioneering initiative for any mutual fund house in India if it proves successful. However, BT was unable to independently confirm whether the fund house is actively pursuing this project.
Buch believes that enabling people to invest with as little as Rs 250 per month, roughly equivalent to $3, will allow a larger section of the population to partake in the wealth creation process. "People are shocked globally when I say roughly $3 a month. Imagine, with less than $3 a month, people will be able to participate in the wealth creation of our nation, and that is our path towards a 'Viksit Bharat'", Buch remarked.
The SEBI Chairperson also discussed the future of the market ecosystem, highlighting that the next phase will involve greater scale and increased complexity. To navigate these changes effectively, Buch emphasized that the adoption of technology will be essential. "A large part of our market ecosystem is now pioneering and leading in terms of technology globally. There is no other place on this globe where a lot of the technology that we have today is present anywhere else", she noted.
As the mutual fund industry prepares for this possible shift, Buch underscored the need for co-creation and collaboration between the regulator and industry stakeholders. She noted that the growing complexity of the market ecosystem requires a more nuanced regulatory approach, one that emphasizes consultation and partnership. "There is no other way of doing the regulator business, other than to co-create. So this is out of sheer necessity", she added.
