The asset management companies would have to meet the minimum funds availability requirements for setting up the mutual fund business. The Capital Market regulator Sebi reported that 100 Crore rupees will be required for setting up an appropriate business of asset management. Sebi is looking forward to implement various new ideas related to the asset management. The idea of seed capital for mutual fund schemes is also under consideration.
The implementation of seed capital concept will aid the asset management to include their own effort in accomplishing the results of a project. The performance of the asset management will also be considered in this regard which will help in improving the shareholder safety.
Sebi, the capital market regulator, has also exclaimed that increasing the investment to 100 Crore rupees from the current threshold of 10 crore will result in protection of the assets more securely.
Consequently, the chances of growth of asset management business will become brighter. This proposal will be further discussed by the Sebu Panel on Monday and will deduce a practical plan for all of the asset management businesses. The plan will also include those asset management companies that have assets of less than the minimum threshold defined by the Sebi.