Islamabad, Jan 6: The Securities and Exchange Commission of Pakistan (SECP) has enhanced the regulatory framework for the mutual fund industry by introducing detailed requirements for “Investment Plans.” This initiative follows previous amendments to the Non-Banking Finance Companies and Notified Entities Regulations, 2008 (NBFC Regulations), aiming to improve governance, streamline operations, and foster retail investment in the mutual fund sector.
The new framework outlines the eligible categories of Collective Investment Schemes (CIS) under which Asset Management Companies (AMCs) can offer Investment Plans. These categories include Fund of Funds, Fixed Rate/Return, Sovereign Income, Asset Allocation Schemes, Capital Protected, and Exchange Traded Funds.
Key operational requirements include guidelines on the maximum number of Investment Plans, their duration, exposure limits, investment restrictions, and performance benchmarks. To promote transparency, the framework mandates clear disclosures for Fund of Fund CIS and additional risk-related information. AMCs are also required to provide a separate Investment Plan report within the Fund Manager Report (FMR), covering offering guidelines, subscription timelines, NAV announcements, and Total Expense Ratio, among other charges.
The SECP’s efforts to implement comprehensive disclosures and structured operational protocols aim to protect investors, ensuring transparency and efficient operations within the mutual fund industry. This initiative further demonstrates the SECP’s commitment to creating a transparent, investor-friendly environment and expanding access to regulated financial products.
