pc
nid 92528
May 14, 2026
pthandapani@vixio.com
India
Securities and Exchange Board of India
financial services
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1779 charsSecurities and Exchange Board of India Launches Consultation on Mutual Fund Intraday Borrowing Lines
On May 13, 2026, the Securities and Exchange Board of India (SEBI) launched a consultation on the utilization of intraday borrowing lines by mutual funds.
The consultation seeks feedback from market participants, including mutual fund operators, custodians, and other stakeholders, on how intraday borrowing facilities should be structured and regulated. Intraday borrowing lines allow mutual funds to manage short-term liquidity needs during the trading day, enabling them to meet redemption requests and execute investment strategies without maintaining excessive cash reserves.
The consultation addresses key considerations including: the appropriate limits and conditions for intraday borrowing; the types of securities that can serve as collateral; pricing mechanisms and interest rate frameworks; risk management and monitoring requirements; and disclosure obligations to investors. SEBI aims to establish a framework that balances operational efficiency for mutual funds with investor protection and financial stability considerations.
This initiative reflects SEBI's ongoing efforts to enhance the operational flexibility of mutual funds while maintaining robust safeguards within India's securities markets.
Market participants are invited to submit their comments and suggestions on the consultation paper. Responses can be submitted through SEBI's public comments portal at www.sebi.gov.in/sebiweb/publiccommentv2/PublicCommentAction.do. The specific deadline for submissions should be confirmed on SEBI's official website.
**Reference:**
Securities and Exchange Board of India. Consultation Paper on utilization of intraday borrowing lines by Mutual Funds. Available at: https://www.sebi.gov.in/sebiweb/publiccommentv2/PublicCommentAction.do?doPublicComments=yes
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1167 charsSecurities and Exchange Board of India Launches Consultation on Mutual Fund Intraday Borrowing Lines
The Securities and Exchange Board of India (SEBI) has released a consultation paper on the utilization of intraday borrowing lines by Mutual Funds.
The consultation paper proposes:
Expansion of permitted purposes suggesting that asset management companies (AMCs) may be allowed to utilize intraday borrowings for purposes beyond meeting redemption and unitholder payouts, such as trade settlements, forex settlements, and derivative obligations.
Borrowing limits and receivables soliciting feedback on whether intraday borrowings can exceed the scheme's guaranteed and non-guaranteed receivables.
End-of-day repayment and overnight limits emphasizing that it remains the AMC's responsibility to repay such intraday borrowings by the end of the day, and any intraday borrowing that converts to an overnight borrowing must strictly comply with the regulatory limits and permitted purposes outlined in the SEBI (Mutual Funds) Regulations, 2026.
Cost allocation maintaining the existing regulatory guideline that any charge or cost levied for availing intraday borrowings must be borne entirely by the AMCs.
Feedback may be submitted via this link by June 3rd 2006.