6wresearch logo

Sebi mulls allowing mutual fund purchases on mobile wallet platforms

August 15, 2016

NEW DELHI: With the number of smartphone users in the country increasing every day, electronic payment applications or mobile wallets are creating the next wave of change in the way people make payments.

Capital market regulator Securities and Exchange Board of India (Sebi) is planning to cash in on this opportunity and has initiated efforts to broaden investor participation in the equity markets. The capital markets regulator is mulling allowing purchase of mutual fund units using digital wallets or e-wallets.

While the Securities and Exchange Board of India (Sebi) is in talks with the Reserve Bank of India to sketch out the ways in which this could be done, analysts are welcoming the move.

Jitendra Solanki, a Sebi certified investment advisor said, "What Sebi has done is to bring growth in the mutual funds industry by tapping these users. Digital wallets will increase their penetration significantly, since it will bring the ease of investing which Gen Y demands. The growth of direct plans have seen the maximum participation from tech-savvy investors and digital wallets will bring even the non-tech savvy to the mutual funds industry."

Digital Wallets have been a significant game changer in the country, especially among youth. According to research by 6Wresearch, India has around 135 million wallet users and Paytm alone has more than 100 millionon its platform. This is double the quantum of users Visa and Maestro have combined.

It is estimated that the digital wallet industry will grow at 68 percent compounded annual growth rate (CAGR) and is expected to touch $11.5 billion by 2022.

In India, around 70 percent of domestic savings goes into bank fixed deposits and the mutual fund industry sees a huge scope for growth. However, experts believe that the low demand of mutual funds from public outside major cities is due to low levels of financial literacy, cultural attitudes towards savings and investments. Banking correspondents should also be engaged to provide basic knowledge of investing and savings to tier 2 and 3 cities to see growth in mutual funds.

At present, with declining rates on fixed deposits and more investors opting for systematic investment plans to invest in equities, assets under management (AUM) of equity mutual funds have grown at a record high to Rs 4.5 lakh crore at the end of July, according to Association of Mutual Funds in India (Amfi) data.

According to the RBI, there are three kinds of wallets - closed, semi-closed and open wallets. For financial transactions, companies who have been established as open and semi closed wallets alone are eligible.

Oxigen Services India Private Limited, Citrus Payment Solutions and Paytm offer semi-closed wallets.

Anil Rego, chief executive officer and founder, Right Horizons said, "We do not believe that this will have a substantial impact on inflows to mutual funds as the KYC processes, and investor education need to be followed. The digital wallets would be an additional feature, but however this is a positive and welcome step."

Media Source: New Indian Express

      Browse More Report

Middle East Structured Cabling Market (2018-2024)

Market Forecast By Product Types (Cables and Components), By Cable Types (Copper Cables and Fiber Optics), By Component Types (Racks & Cabinets, Patch Panel & Cross Connects, Communication Outlets and Patch Cords & Cable Assemblies), By Applications...

Read More

Kuwait Air Compressor Market (2018-2024)

Market Forecast By Types (Portable and Stationary), By Lubrication Method (Oil-Injected and Oil Free), By Technology (Rotary (0-75kW, 76-160kW and Above 160kW), Centrifugal (0-500kW and Above 500kW), Reciprocating (0-10kW and Above 10kW)), By Applications...

Read More

Indonesia Diesel Genset Market (2018-2024)

Market Forecast By KVA Ratings (5-75 KVA, 75.1-375 KVA, 375.1-750 KVA, 750.1-1000 KVA and Above 1000 KVA), By Verticals (Commercial, Industrial, Residential and Public Infrastructure), By Applications (Standby and Continuous/Prime), By Regions...

Read More

Malaysia UPS Systems Market (2018-2024)

Market Forecast By KVA Ratings (Up to 1.1 kVA, 1.1 kVA - 5 kVA, 5.1 kVA - 20 kVA, 20.1 kVA - 50 kVA, 50.1 kVA - 200 kVA and Above 200 kVA), By Applications (Commercial (Offices, Healthcare, Hospitality, BFSI, Data Centres and Others including Retail, Government Buildings...

Read More

Vietnam UPS Systems Market (2018-2024)

Market Forecast By KVA Ratings (Up to 1.1 kVA, 1.1 kVA - 5 kVA, 5.1 kVA - 20 kVA, 20.1 kVA - 50 kVA, 50.1 kVA - 200 kVA and Above 200 kVA), By Applications (Commercial (Offices, Healthcare, Hospitality, BFSI, Data Centres and Others including Retail, Government Buildings...

Read More

Global Gas Genset Market (2018-2024)

Market Forecast By KVA Ratings (Upto 100 KVA, 100.1-375 KVA, 375.1-1000 KVA and Above 1000 KVA), By Applications ((Residential, Industrial including Manufacturing and Production, Commercial (Offices, Museum, Hospitality, Retail, Education and Data Center)...

Read More

Thailand Diesel Genset Market (2018-2024)

Market Forecast By kVA Rating (5kVA - 75kVA, 75.1kVA - 375kVA, 375.1kVA - 750kVA, 750.1kVA - 1000kVA and Above 1000kVA), By Applications (Residential, Hospitality, Commercial, Healthcare, Retail, Manufacturing, Oil & Gas and Power Utilities, Infrastructure...

Read More

India Video Surveillance Analytics Software Market (2018-2024)

Market Forecast By Macro Applications (Traffic Surveillance, Building Surveillance, City Surveillance and Business Intelligence), By Micro Applications (Perimeter Intrusion Detection, Pattern Recognition, Counting & Crowd Management, Automatic License Plate Recognition...

Read More

India Gas Genset Market (2018-2024)

Market Forecast By Rating (Up to 100 kVA, 100.1 kVA - 375 kVA, 375.1 kVA - 1,000 kVA and Above 1,000 kVA), By Verticals (Industrial, Commercial and Residential), By Applications (Standby Power, Primary Power and Peak Shaving), By Regions...

Read More

India Air Conditioner Market (2018-2024)

Market Forecast By Types (Window AC, Split AC, Floor Standing, Cassette AC, Packaged, Ducted / Ceiling Concealed, Centralized (Chiller, VRF/VRV and AHU/FCU)), By Applications (Residential, Commercial Buildings & Retail, Government & Transportation, Hospitality and Others...

Read More

Saudi Arabia Industrial Valves Market (2018-2024)

Market Forecast By Types (Gate, Globe, Check, Ball and Others), By Functionality (On/Off and Control), By Applications (Oil & gas, Water & Wastewater, Chemical & Petrochemical, Power & Utility, Construction and Others), By Regions (Eastern, Western, Central and Southern)...

Read More


Our Key Clients
6wreserach client list


6Wresearch Events
6wreserach events