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Securities and Exchange Board of India Updates Rules for Asset Management Companies being Launched by Fintech Firms and Other Startups
The
Securities and Exchange Board of India (SEBI), the regulator of the nation’s securities and commodities market, announced on Wednesday (December 16, 2020) that it has updated guidelines related to establishing asset management companies (AMCs) for Fintech firms and other startups.
SEBI confirmed that it has tightened up the shareholding guidelines for firms that may be relisting after completing the corporate insolvency resolution process (CIRP) in order to ensure fair price discovery.
SEBI stated that an entity may sponsor a mutual fund even if it’s unable to meet profitability requirements. But the entity must have a net worth of at least Rs 100 crore (appr. $13.6 million). Currently, mutual fund sponsors are required to have a profitability track record and must have a net worth of Rs 50 crore.