Rs 250 SIP: SEBI Seeks Inputs From Investors - How To Participate

The Securities and Exchange Board of India (SEBI) aims to launch low-cost Systematic Investment Plans (SIPs) with a minimum investment of just Rs 250 (around $3). This initiative seeks to expand equity investing in smaller towns across India, making mutual funds accessible to a broader population.

About 225 million Indians currently invest through SIPs, primarily in urban areas. Last year, SIPs contributed an average of Rs 223.6 billion ($2.59 billion) monthly to Indian equities, acting as a stabilizing factor amidst foreign investor sell-offs.

“To promote financial inclusion,  inculcate the habit of systematic  saving  and facilitate  investment  of  small  savings  by  investors  new  to the Mutual  fund space, by sachetisation of Mutual Funds” as per the Sebi report.

SEBI:  Small-Ticket SIP Scheme
 

Investors can start up to three Rs 250 SIPs, one with each of three different Asset Management Companies (AMCs). Additional SIPs are allowed, but discounts apply only to the first three SIPs.

These SIPs will only be available under the Growth option. Payments can be made through cost-effective methods like UPI auto-pay and NACH.
Investments can be done in either Statement of Account (SOA) mode or Demat mode, giving investors more choice.

KYC expenses will be covered by charging a small fee (1 basis point) to the mutual fund schemes, which will also fund investor education and awareness. To encourage distributors to promote the scheme, they will receive a ₹500 incentive for educating new investors and helping them start long-term investments.

SIP Scheme: How To Contribute

The comments/suggestions should be submitted By February 06, 2025, through the following link:
https://www.sebi.gov.in/sebiweb/publiccommentv2/PublicCommentAction.do?doPublicComments=yes

Here are the steps:

1. Read Instructions: Before starting, read the “Instructions” provided at the top-left corner of the web form.
2. Select Consultation Paper: From the dropdown menu under “Consultation Paper,” choose the paper you want to comment on and fill in the required details.
3. Complete All Fields: Ensure all fields in the form are filled, as they are mandatory.
4. Unique Contact Details: Use a unique email ID and phone number for each consultation paper.
5. Organization Details: If you represent an organization not listed in the dropdown, select “Others” and specify the type.
   If you don’t represent any organization, select “Others” and mention “Not Applicable.”
6. Proposal Selection: Use the dropdown to select each proposal.
   Indicate your level of agreement (mandatory).
7. Provide Comments: If you want to comment on a proposal, select “Yes” and provide your comments in the text box. “Submit” to save your response for each proposal and move to the next one.
8. Skip Proposals: If you don’t want to respond to a proposal, select it and “Skip this proposal.”
9. Review and Finalize: After responding to all proposals, review your responses by ing “Check your response before submitting.” You can download a PDF of your draft responses from the link at the bottom-right corner of the page.
10. Submit Final Comments: Submit your final comments only after responding to all proposals.
     

SEBI: Attracting Young Investors

The National Stock Exchange (NSE) of India's unique registered investor base exceeded 11 crore with 1 crore in the last five months.  With 40% of India’s population under 30, young investors are increasingly drawn to equity investments. Zerodha, a leading digital platform, reports rising interest in SIPs under Rs 500 and sees the Rs 250 SIPs as an opportunity to attract Gen Z investors.

The Rs 250 SIPs will primarily feature hybrid funds, offering a mix of equity and debt investments. This approach ensures a balance between growth potential and safety, catering to new and small investors.