Regulatory Alerts2026-03-13
Borrowing by Mutual Funds
The Securities and Exchange Board of India (SEBI) issues this circular to specify conditions for intraday borrowings by mutual funds effective April 1, 2026, under the SEBI (Mutual Funds) Regulations, 2026. Intraday borrowings are permitted to bridge timing mismatches for redemptions and payouts, provided they do not exceed guaranteed same-day receivables from government entities and any associated costs are borne by the Asset Management Company. Additionally, the regulator clarifies that equity-oriented index funds and ETFs may borrow funds to participate in the Closing Auction Session to settle under-executed sell trades.
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