List of new rules coming into effect for mutual funds from 2022

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MFs, RIAs to disclose turnaround time of grievance resolution

Mutual funds and RIAs have to disclose average turnaround time for redressal of investor grievances on their respective websites from January 1, 2022.

AMFI, mutual funds, RIAs to release investor complaint data every month

Mutual funds and AMFI will be disclosing details of investor complaint on a monthly basis from January. Till now, they used to publish the data on an annual basis.

ETF transactions may get faster

Through a circular in September, SEBI allowed exchanges to introduce T+1 cycle for settlement of transactions. Exchanges willing to adopt the shorter settlement time can do so from 2022.

If they do so, ETF transactions will also get faster as they are listed on exchanges.

Deadline extended for two regulations

There were two regulatory changes which were also supposed to come into effect from January 2022 but were postponed to April 1, 2022. They are:

  • Schemes to get two benchmarks

From April 1, mutual funds can choose to have two benchmarks for their schemes — one for comparison and another for style.

They will also have to choose the primary benchmark based on the risk level of the scheme.

  • New risk management framework comes into effect

In September 2021, SEBI released a revised risk management framework for mutual funds.

As per the new framework, AMCs have to ensure that they have the mechanism to evaluate instances of mis-selling, prepare inspection report, analyse portfolio of investors and so on.

Further, the new framework says that AMCs will be responsible for mis-selling by distributors.

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