Following SEBI’s initiative on sachetisation of investment in mutual fund schemes, SBI Mutual Fund has launched the first micro-SIP scheme. Such products will help low-income people invest small amounts regularly and thus participate in equity markets, explains Saikat Neogi
Rationale behind micro-SIP
Micro Systematic Investment plan (SIP) is a small-ticket mutual fund product of Rs 250 for lower-income individuals. It will make mutual fund investments accessible to first-time investors, especially those from rural and semi-urban areas, inculcate in them the financial discipline to achieve their financial goals, and help them take advantage of rupee-cost averaging. Micro-SIPs can help increase the reach of mutual funds, expand the investor base and spread the equity cult in the country just as Pradhan Mantri Jan Dhan Yojana, launched in 2014, helped drive the country’s financial inclusion.
ALSO READMotilal Oswal’s 4 funds shine despite market crash – Check their 1-year returns
Investing small amounts regularly over a long time is the first step towards wealth creation. For example, by investing Rs 250 every month for 25 years, the total value will be around Rs 4.25 lakh, assuming 12% compounded returns. To be sure, SIPs have gained popularity among retail investors as they do not have to worry about market volatility and timing the market. SIP contributions have touched an all-time high of Rs 2.37 lakh crore in FY25 till January. The total SIP assets under management (AUM) is Rs 13.2 lakh crore as on January-end.
How can one invest in such schemes?
An individual can invest in only three micro-SIP schemes of Rs 250 each (one each in three asset management companies) at subsidised rates. Though an investor can invest in more than three schemes, the discounted rates offered by the intermediaries will be restricted to only the first three. According to the Securities and Exchange Board of India’s (SEBI) consultation paper, the micro-SIPs will be offered in any schemes except for debt, sectoral and thematic, small and mid-cap categories. Last week, SBI Mutual Fund, in collaboration with State Bank of India, launched JanNivesh SIP, which offers flexible SIP options starting at Rs 250, with daily, weekly, and monthly investment plans. The scheme will be under SBI Balanced Advantage Fund, an open-ended fund that balances investments between equity and debt. Investors can access the scheme through SBI YONO or other fintech platforms like Paytm,
» Read More
