MF Lite Framework : SEBI
The Securities and Exchange Board of India (SEBI) introduced the Mutual Funds Lite (MF Lite) framework on September 30 to promote passively managed mutual fund schemes.
- This initiative aims to attract new players to the mutual fund industry, offer diversified and less risky investment opportunities for retail investors, and enhance market liquidity.
- It Lower eligibility criteria for sponsors, including requirements related to net worth, track record, and profitability, to ease entry for new AMCs.
- Mandates a minimum net worth of ₹35 crore for AMCs operating passive funds, ensuring adequate liquidity.
- Reduced oversight role for trustees in passive funds, with a focus on preventing conflicts of interest and market misconduct.
- Daily operational control shifted to the AMC’s board to maintain transparency in fees, expenses, and tracking errors.
