SEBI Eases Redemption Norms For Mutual Fund Investors

Securities and Exchange Board of India vide it circular dated 31st May, 2016 eased the redemption norms for mutual fund investors by allowing them to redeem their investment partially even if the asset management company imposes restriction on redemption.

As per the earlier circular, Board of Directors of the Asset Management Company (AMC) and the Trustees could impose restriction on redemption under any scheme of the mutual fund. Due to the general nature of provisions in the earlier circular giving discretionary powers to AMC's and in light of recent incidents of companies imposing unreasonable restrictions, SEBI recognised the need to have a re-look at the circumstance under which such restriction on redemption could be imposed.