The Securities and Exchange Board of India has asked mutual fund registrar and transfer agents to develop a common industry-wide platform for purchase and sale of mutual funds and to handle service requests.
The mutual fund industry has two RTAs currently, Computer Age Management Services Ltd, and KFin Technologies Pvt Ltd. Investors have to use the websites of mutual funds totalling more than 40 or the services of distributors or commercial platforms for transactions.
Procuring account statements is also a difficult task. RTAs send common emailed statements from each of their websites on request, but awareness about this option is low.
The Sebi circular issued on Monday said asset management companies, RTAs, and depositories shall review and agree to harmonize the processes across the industry to provide a single-window, integrated, simplified investment and service experience for investors. The platform will provide services, including reports on mutual fund holdings in demat and standard statement of account, transactions, capital gains and losses, and details of unclaimed dividend and redemption.
The platform will be made operational in a phased manner by the RTAs and will become fully operational by 31 December 2021, according to Sebi.
“It will be implemented in three stages. Stage 1 will be for non financial transactions. Stage 2 will be the launch of the mobile app and stage 3 will be for financial transactions. About 80% of the work on stage 1 has been completed. There will be opportunities to monetize the platform such as selling ad space on it to AMCs and selling APIs to fintechs,” said Sreekanth Nadella, chief executive, KFin Technologies.
The inter-operable platform will be a big step in the direction of improvement in the investor service.