Mutual Fund

BSE StAR Mutual Funds Platform

Genesis

In order to extend the convenience that investors in the secondary market have, to investors in Mutual funds, a SEBI Committee under the chairmanship of Mr. K N Vaidyanathan, ED - FII & MF consisting of representatives from Exchanges, industry and depositories was set up to consider the feasibility of allowing Stock Exchanges (SEs) to offer their existing infrastructure for buying and selling of MF units, in addition to the prevailing distributor / Independent Financial Advisor route.

The Committee appointed a sub-group consisting of representatives from BSE Limited, National Stock Exchange (NSE) and two Mutual Funds to map out the modalities. This culminated in SEBI issuing a Circular on November 13, 2009 enabling this route and giving guidelines to all stakeholders on the facility of collecting applications for Mutual Fund transactions through Stock Exchanges.

BSE's Strength Areas

Asia's first stock exchange, BSE continues to bring trust and stability to capital market in India. It has over 40,000 trading terminals connected through 2918 Lease Lines and 1841 VSAT terminals which are spread over 400 cities.

BSE has a proven trading and settlement platform assuring efficient on-time transactions and is a Self-Regulatory Organization (SRO) ensuring transparency to all stakeholders.

It has ISO certified processes governing clearing and settlement, Information Technology and Surveillance and offers seamless settlement processes supported by state-of-the-art clearing and system.

BSE has welcomed this industry-friendly and investor-friendly initiative of SEBI and reiterates its commitment to use its robust and time-tested infrastructure to make this convenience available to the mutual fund industry and stakeholders.

Launch of BSE StAR MF

MFI Model (For Member Brokers)

BSE launched its BSE StAR MF platform on December 4, 2009 in the presence of Mr. C B Bhave, SEBI Chairman. The platform would be available from 9 a.m. to 3 p.m. on all working days of the exchange.

MFD Model (For ARN Holders/IFAs)

SEBI vide its circular CIR/MRD/DSA/32/2013 dated 4th October, 2013 has allowed Mutual Fund Distributors to use recognized stock exchanges' infrastructure to purchase and redeem mutual fund units directly from Mutual Fund/Assets Management Companies on behalf of their clients.

BSE Ltd offers its platform to Mutual Fund Distributors (MFDs) to purchase and redeem mutual fund units on behalf of their clients. The MFDs will not handle payout and pay in of funds as well as units on behalf of investors.

The pay in will be directly received by Indian Clearing Corporation Ltd (ICCL) and payout will be directly made to investor's account.

Business Model

BSE StAR MFTM is a browser-based front end. Its architecture provides scalable operation and flexible deployment options while ensuring data integrity for improved performance.

The platform is feature-rich and highly flexible - it has link-ups with both depositories CDSL and NSDL, facility for one-time registration of client to avoid extra keystrokes for repeated buy/sell requests.

MFI Model: Brokers of BSE who are registered ARN (AMFI registration No.) holders are eligible to participate on this platform as Mutual Fund Intermediaries (MFIs).

Advantages to Investors/Other Stakeholders of using BSE StAR MF

• Independent view of customer's entire portfolio at one place
• Reduction of paperwork and ensuing errors
• Reduction of redundancy in process and data duplication at RTA and Distributor levels
• De-risking MF settlement processes by using superior Delivery v/s Payment (DVP) process provided by Stock Exchanges
• Efficiently & effectively address customer servicing issues
• Extending present convenience available to Secondary market to mutual fund investors
• Enable transparency to customers
• Enable charging customers for service at the point where it is rendered

About Mutual Funds

What is a Mutual Fund?

A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities...

Who can invest in a Mutual Fund?

Anybody with an investible surplus of as little as a few hundred rupees can invest in mutual funds.

How does a Mutual Fund appreciate your investment?

A mutual fund manager proceeds to buy a number of stocks from various markets and industries...

What are the advantages of investing in a Mutual Fund?

• Small investments.
• Professional Fund Management.
• Spreading Risk.
• Transparency and easy access to information.
• Liquidity.
• Choice.
• Regulations.

What are the various types of Mutual Fund schemes?

• Open-Ended Schemes
• Close-Ended Schemes