The Securities and Exchange Board of India (SEBI) recently concluded its 212th Board Meeting in Mumbai. The regulator has announced several significant changes designed to make investing easier, cheaper, and more transparent.
Whether you are a mutual fund investor, a retail stock trader, or someone holding physical share certificates, here are the 5 most helpful points you need to know.
1. Mutual Funds: Cheaper Costs and Simpler Rules
SEBI has overhauled the rules to benefit investors directly.
- Lower Costs: New regulations exclude statutory levies (like STT and GST) from the Base Expense Ratio. To balance this, brokerage limits have been cut.
- Cheaper Execution: The brokerage cap for cash market trades is reduced to 6 bps, and for derivatives, it is reduced to 2 bps.
- No Extra Fees: The additional expense allowance previously charged to schemes with exit loads has been removed.
2. Easier IPOs for Retail Investors
Participating in Initial Public Offerings (IPOs) is set to become much more user-friendly.
- Early Information: A focused "Draft Abridged Prospectus" will now be available right from the start (DRHP stage).
- Better Clarity: This summary helps retail investors understand key risks early, without needing to read hundreds of pages of technical data.
3. No More "Letter of Confirmation" Hassles
If you have ever requested duplicate share certificates or transmission of shares, the process just got faster.
- Digital First: The requirement for companies to issue a physical "Letter of Confirmation" is removed.
- Direct Credit: Shares will now be directly credited to your demat account.
- Faster: The timeline for these requests is expected to drop from 150 days to just 30 days.
4. A Second Chance for Physical Share Holders
Many investors missed the 2019 deadline to transfer physical shares. SEBI is providing relief.
- New Window: If you bought physical shares before April 01, 2019, but did not lodge the transfer deeds in time, a new window will open for you to submit them.
- Rights Restored: This allows investors to finally claim ownership of shares that were previously stuck.
5. Retail Incentives for Corporate Debt
To encourage more people to invest in bonds, SEBI is adding incentives.
- Extra Benefits: Debt issuers can now offer incentives—like higher interest or discounts—specifically to retail investors and senior citizens.
- Note: These incentives apply only to the original buyer.
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