Zerodha gets in-principle approval to launch mutual fund, says Nithin Kamath
The firm had applied for a mutual fund licence in February 2021.
September 02, 2021 / 05:02 PM IST
Zerodha co-founder Nithin Kamath.
Zerodha founder Nithin Kamath on September 1 announced that the firm has received in-principle approval from the Securities and Exchange Board of India (SEBI) to set up an asset management company (AMC).
The country's largest discount broker had applied for a mutual fund licence in February 2021. With this, Zerodha will now be able to start its asset management company (AMC) in a year’s time.
Earlier in August, Bajaj Finserv received in-principle approval from SEBI to set up shop in the Rs 35 trillion mutual fund (MF) industry.
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Zerodha has for long focused on bringing transaction costs down in its discount brokerage business. The firm had planned to launch low-cost funds. “Passive, simple, cheap index-traded funds will be on offer,” Kamath had said.
“Mutual fund products need to be simplified to attract investments from young investors,” says Kamath.
Zerodha started its journey in 2010 as a ‘Rs 20 per order broker’ and gained popularity as a no-frills, low-cost player among traders, especially high-volume derivatives traders.
Zerodha handles five to seven million trades a day on the exchanges. Retail investors also found it attractive to invest in the direct option of mutual fund schemes using the ‘Coin’ platform launched by Zerodha. Coin today has assets under management of more than Rs 15,000 crore.