Context:
To promote small-ticket investing and deepen mutual fund penetration, the Securities and Exchange Board of India (SEBI) has nudged AMFI (Association of Mutual Funds in India) to push for the rollout of ₹250 micro-SIPs under the Chhoti SIP initiative.
Key Highlights:
- SEBI’s Initiative:
- First proposed in a January 2025 consultation paper.
- Aimed to financialise savings and expand retail participation in mutual funds.
- Proposed cost subsidies for fund houses to absorb onboarding and transaction-related costs for low-ticket investments.
- AMFI’s Response:
- On June 27, AMFI sent a letter to all fund houses asking for their plans to launch ₹250 SIPs.
- The move comes as over two-thirds of fund houses are yet to introduce these offerings.
- Current Status:
- Top 15 AMCs (by AUM) have already reduced minimum SIP sizes—some as low as ₹100.
- However, ₹250 SIPs specifically qualify under SEBI’s proposed subsidised framework.
- The final circular from SEBI is still awaited, adding to market uncertainty.
- Implementation Challenges:
- The SEBI framework limits subsidy eligibility to only the first three ₹250 SIPs per investor.
- AMCs report technical and procedural hurdles in verifying investor eligibility during onboarding.
- If SIPs are launched at any other amount, subsidy benefits won’t apply.
Association of Mutual Funds in India (AMFI)
Association of Mutual Funds in India (AMFI) is an Indian trade association for all the asset management companies of SEBI registered mutual funds in India.
