
You can give mutual funds as a gift card soon. Here is how
Sebi has proposed two pathways for scheme selection, recognising that many recipients will be first-time investors.In the first pathway, the card purchaser — the person gifting the card — may suggest a mutual fund scheme at the time of purchase. However, this suggestion is not binding.
Sebi has explicitly clarified that this does not amount to investment advice or a recommendation under Sebi's rules.The recipient can invest in the scheme suggested by the gift giver or make his or her own choice. In either case, the transaction will be processed under the direct plan, which carries no distributor commission and therefore a lower expense ratio.In the second pathway, the recipient may choose to consult a mutual fund distributor for assistance on selecting the scheme.
In that case, the investment is routed through the regular plan, which includes distributor commission within the fund’s expense ratio.The choice rests entirely with the recipient.Once invested, any redemption proceeds — the amount received when units are sold — are credited only to the recipient’s own registered bank account.Sebi has proposed a clear set of rules to keep the framework simple and prevent misuse.The maximum value of each Gift PPI is ₹10,000— in line with RBI (Reserve Bank of India) rules on prepaid instruments. The card cannot be reloaded once issued.
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