Rs 250 SIPs may soon become a reality for greater accessibility

Markets regulator the Securities and Exchange Board of India (SEBI) wants to allow investors to start SIPs (systematic investment plans) for as little as Rs 250.

What we know so far about the proposal

• By introducing small-ticket SIPs, SEBI is aiming for financial inclusion, especially for lower-income and under-served groups.
  
• But don't SIPs start with as little as Rs 100? Yes, they do, but they are not universally available.
  
• These bite-sized investments will likely be available under a mutual fund scheme's growth plan.
  
• Investors won't be allowed to start these SIPs in the following segments:
  
• Mid-cap funds
  
• Small-cap funds
  
• Sectoral and thematic funds
  
• Debt funds
  
• To help fund houses achieve breakeven quickly, industry and depository participants have agreed to offer discounted rates.
  
• One limitation is that the proposed small-ticket SIP of Rs 250 may be limited to a maximum of three SIPs (one each in up to three fund houses). (We are yet to receive full clarity on this aspect)
  
• SIP payments could be restricted to the National Automated Clearing House (NACH) and Unified Payment Interface (UPI) auto-pay modes.
  
• Please remember that this proposal is just at a consultation stage. Comments on the proposal must be submitted to the SEBI by February 6, 2025.

Also read: SEBI allows mutual fund investors to name up to 10 nominees