SEBI gives mutual funds time till 1 October to offer ASBA facility for new schemes
28 Jul 2010
The Securities and Exchange Board of India (SEBI) has extended the deadline for mutual funds and other asset management companies for complying with the `Applications Supported by Blocked Amount' (ASBA) facility for new fund offers to 1 October 2010.
The market regulator had, in a circular dated 15 March 2010, made it mandatory for mutual funds/AMCs to provide ASBA facility to the investors for all NFOs launched on or after 1 July 2010.
SEBI has now modified the circular partially, providing for extending the ASBA facility to investors in all NFOs of mutual funds to 1 October 2010.
This has been done to protect the interests of investors in securities and to promote the development of, and to regulate the securities market, SEBI said in a release.
The ASBA facility, originally meant to protect the interests of capital market participants, especially in public issues of companies, would help investors save interest cost on borrowing while helping issuers avoid the hassles of refunds.
SEBI, meanwhile, had also reduced the period between the opening and closing of public issue of shares by companies to 15 days from the earlier 30-45 days.