Description

BSE introduces Specialized Investment Funds (SIF) of Tata Mutual Fund with specific investment requirements for Accredited and Non-Accredited Investors, including minimum investment thresholds and distributor registration requirements.

Summary

BSE has introduced Specialized Investment Funds (SIF) of Tata Mutual Fund on the BSE StAR MF Platform. The circular outlines investment eligibility criteria for Accredited and Non-Accredited Investors, establishes minimum investment thresholds, and specifies distributor registration requirements. A separate AMC creation has been activated for SIF schemes, and distributors must pass NISM XIII examination and register with AMFI to distribute SIF products.

Key Points

  • Separate AMC creation activated for SIF schemes on BSE StAR MF platform
  • Non-Accredited Investors must invest minimum ₹10 lakh for first-time investment in any SIF scheme
  • Accredited Investors subject to minimum amounts set by AMC in Scheme Information Documents (SID)
  • SIF client AUM must not fall below ₹10 lakh due to redemption or any other reason
  • Distributors must pass NISM XIII examination and register with AMFI to distribute SIF schemes
  • BSE platform provides manual and bulk upload facility for updating Accredited Investor details
  • Accredited Investor details frozen at order entry level for fresh/lumpsum subscriptions creating new folios
  • For joint holdings, AI status depends on first holder classification across all transaction types

Regulatory Changes

Investor Classification System:

  • Two investor categories introduced: Accredited Investor and Non-Accredited Investor
  • Different minimum investment thresholds applied based on investor classification

Distributor Requirements:

  • New and existing members must pass NISM XIII examination
  • Mandatory registration with AMFI for SIF distribution
  • Only registered distributors from existing list allowed to distribute SIFs
  • Auto mapping/empanelment for SIF in AMC for qualified distributors

Mode of Holding Rules:

  • Single Mode: AI exemptions apply if first holder is AI
  • Joint Mode (FH=AI, JH=Non-AI): AI exemptions apply
  • Joint Mode (FH=AI, JH=AI): AI exemptions apply
  • Joint Mode (FH=Non-AI, JH=AI): AI exemptions do not apply, normal SIF regulations with limitations

Compliance Requirements

For Distributors:

  • Complete NISM XIII examination
  • Register with AMFI for SIF distribution
  • Update Accredited Investor details accurately through member login (manual or bulk upload)
  • Verify AI details before order entry to avoid rejections
  • Monitor client reports through Admin » Admin Reports » Accredited Client Report

For Accredited Investors:

  • Renew registration certificate prior to expiry with certificate issuing authorities
  • Maintain AUM above ₹10 lakh threshold at all times

For Non-Accredited Investors:

  • Invest minimum ₹10 lakh for first-time investment
  • Maintain AUM above ₹10 lakh threshold at all times in AMC/RTA records

File Format for Bulk Upload:

  • Pipe-separated text file
  • Structure: Member Code | Client Code | PAN Number | Accredited No. | Validity
  • Path: Admin » client details » client master upload

Important Dates

  • No specific effective dates mentioned
  • Accredited Investor certificates must be renewed prior to expiry

Impact Assessment

Market Impact:

  • Expands investment product offerings on BSE StAR MF platform with introduction of SIF category
  • Creates segregated market for high-net-worth and accredited investors
  • Limited initial impact as only Tata Mutual Fund SIF schemes introduced

Operational Impact:

  • Distributors must obtain additional certification (NISM XIII) and AMFI registration
  • Additional compliance burden for maintaining and updating Accredited Investor database
  • Enhanced due diligence requirements at order entry stage
  • Risk of transaction rejection if distributor not properly registered or AI details inaccurate

Investor Impact:

  • Higher entry barrier for non-accredited investors (₹10 lakh minimum)
  • Mandatory maintenance of minimum AUM threshold
  • Different investment limits based on accreditation status
  • Joint account holders subject to specific AI status rules based on first holder classification

Impact Justification

Introduces new SIF product category with specific investor classification and minimum investment requirements, affecting mutual fund distributors and high-net-worth investors but limited to Tata MF schemes