Mutual funds, now gift-wrapped

Anewroute could make MFs more personal & more accessible

- KUSHAN SHAH

THE SECURITIES AND Exchange Board of India (Sebi)on Tuesday floated a novel idea to make investing alittle more personal—andalot moreaccessible.

Ithas proposed allowing gift PPIs (prepaid payment instruments) to be used for buying mutual fund (MF) units, effectively turning investments into something you can wrap, send and share.

Underthe proposal,investors could gift mutual fund units to friendsand family through these instruments, each capped at 10,000, valid for a year, and strictly non-reloadable—more like a onetime present than a reusable wallet. The move followsasuggestion from the Association of Mutual Funds in India (Amfi), which sees thisasawayto bring first-time investors into the fold.Bylowering the psychological barrier to entry,theindustry hopes a simple gift could becomesomeone’sfirst stepinto financial markets.