SEBI Releases Proposal For Rs. 250 SIP

The Securities and Exchange Board of India has proposed a small-ticket systematic investment plan worth Rs. 250. This would be half of the current minimum monthly investment base of Rs 500.

As per the consultation paper floated by the regulator, an investor using this avenue will be allowed to invest in up to three schemes (one each in a different asset management company).

The regulator has also mentioned in its paper that such SIPs will only be offered under the growth option of the plan. 

This is being done to encourage more participation in mutual fund investments by making it more accessible for first-time investors, low-income group individuals, and people from remote areas of the country. 

In order to increase the accessibility of the scheme, SEBI has also proposed to reduce the costs related to it, such as subsidising KYC and other related expenses through the Investor Education and Awareness Fund.

Investments under this scheme will primarily operate through digital payment modes like UPI or the National Automated Clearing House (NACH).

The proposals are open for public comments till Feb 6.

SEBI Chairperson Madhabi Puri Buch has been speaking about the benefits of a smaller ticket systematic investment plan for a long time now.

On Sept 2, 2024, at the CII Financing Summit, she said that the market regulator and the industry are working on launching a SIP in which the investor needs to contribute as little as Rs 250.

"SEBI is managing an increasing variety of asset classes, products, and participants. The focus is on providing the right product for the right person, moving beyond a one-size-fits-all approach," she had said.

Later on Jan. 10 Buch complimented State Bank of India Chairman CS Setty on pledging to support the idea.