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SEBI says same-day NAV can be availed only after funds realised

Earlier, it was possible to get same day's NAV if the investment was less than Rs 2 lakh.

September 18, 2020 / 08:08 PM IST

The Securities and Exchange Board of India (SEBI) on September 17 stated that mutual fund (MF) investors would be able to avail the closing net asset value (NAV) of the scheme, on the day their funds are realised.

"... it has been decided that in respect of purchase of units of mutual fund schemes (except liquid and overnight schemes), closing NAV of the day shall be applicable on which the funds are available for utilisation irrespective of the size and time of receipt of such application," SEBI circular read.

The new ruling would come into effect from January 1, 2021.

Earlier, an MF investor could even get the same-day NAV -- regardless of realisation of funds -- as long as the investment was under Rs 2 lakh and before cut-off time.

“Earlier, there was some flexibility given. With the banking system now becoming more robust, the applicability has been made on the realisation of funds across the board,” said Dhirendra Kumar, founder and chief executive officer of MF tracker Value Research.

Kumar said that it is not necessary that investors would not get the same day’s NAV now. “If the transaction is done online, the funds can be quickly credited. In the case of cheque deposits, there could be some lag,” he said.


Industry executives say they’d consult their operations team to see how these changes can be adapted to align with the existing system.

Putting things in 'order'

In the same circular, the regulator also directed mutual funds to use an automated order management system (OMS) for buying and selling of equities.

The regulator said the orders will be placed by the fund managers of the respective schemes. In case the fund manager is handling multiple schemes, the fund manager must place scheme-wise order.

The regulator also wants all allocation limits specified in the scheme information document to be built in the OMS, so that any order that is in breach of these limits don’t get accepted.

SEBI also laid down guidelines for the dealing desk of the fund house.

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Jash Kriplani
first published: Sep 17, 2020 09:26 pm
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