Page 21 - Banking Finance September 2019

MUTUAL FUND

Mutual fund investors likely to rejoice as Fin Min an-
Reliance Mutual Fund
nounces stimulus
joins hands with
Ranging from tax sops to ease of doing business, a slew of measures has been
MobiKwik to introduce declared by Finance Minister in order to boost the

‘Kwik Save’ slugging fortunes of the Indian economy.
This might help to brighten the lives of mutual fund
investors in the coming days, according to the in-
dustry experts. The stock market has been going
through a rough phase lately due to the wide-
spread pessimism in the economy and in the ab-
sence of any economic package in the last budget.
Most equity mutual funds have been offering negative returns in the last one
year. For example, the large cap mutual fund category has been offering -7.58%
returns in the last one year. Mid cap and small cap mutual funds were the worst
Reliance Nippon Life Asset Manage- hit, with both categories offering double-digit negative returns in the last one
ment (RNAM) has entered into a year.
partnership with MobiKwik in order The finance minister announced the scrapping of enhanced surcharge on short-
to launch ‘Kwik Save’, an investment term and long-term capital gains tax. “In other words, the enhanced surcharge
product in the liquid fund category, on FPI goes,” said Sitharaman.
with an instant redemption feature. The increased surcharge on FPI has severely impaired the market sentiment.

Kwik Save is a feature on the Many FPIs, especially pension funds and sovereign funds, that were listed as
MobiKwik application, in the mutual trusts were hit by the new surcharge announced in the budget, and many of
funds section, that will allow users them have started selling heavily soon after that.
to earn higher interest than fixed With the scrapping of the enhanced surcharge, the government has finally ad-
deposits or savings bank account by dressed concerns of the stock market. The move will definitely help to improve
parking their excess funds in Reli- the sentiment in the short term.
ance Liquid Fund. The investment However, the revival of fortunes of the market entirely depends on the efficacy
process through Kwik Save is simple
of the other measures announced by the finance minister to revive the slum-
and can be completed in less than bering Indian economy.
60 seconds.
"We are delighted to co-create and SBI Mutual Fund, UTI AMC appointed as EPFO’s fund
power the "Kwik Save" feature for managers
MobiKwik users. Kwik Save will offer
users simple yet attractive proposi- Employees' Provident Fund Organisation (EPFO) has given approval to the ap-
pointment of UTI AMC and SBI Mutual Fund as its
tion to earn better returns from
their idle funds. fund managers for three years, as informed by the
source. The EPFO has also approved a proposal for
We believe with this feature, to- early redemption of its investment of around Rs 700
gether we will be able to reach over crore in bonds of troubled Dewan Housing Finance
85 million MobiKwik users and pro- Corporation Ltd (DHFL.
vide them an opportunity to initiate
“The EPFO’s apex decision-making body Central Board of Trustees (CBT) headed
investing in Mutual Funds in a seam- by Labour Minister Santosh Gangwar has decided to appoint two fund manag-
less, digital manner,” said Sundeep
ers UTI AMC and SBI Mutual Fund for a three-year term,” the source said.
Sikka, ED and CEO of Reliance
Nippon Life Asset Management. The source further said, “The CBT also decided to exercise early exit option for
redeeming its investment of around Rs 700 crore in bonds of DHFL.”

BANKING FINANCE | SEPTEMBER | 2019 | 21