Micro SIPs For Financial Inclusion, But SEBI Questions Promotional Incentives

Systematic Investment Plans (SIPs) are a popular investment tool, and the market watchdog SEBI has taken a significant step by reducing the ticket size to encourage financial inclusion. However, concerns are now being raised over certain promotional schemes by SEBI-registered Multipl Wealth Management. The app, which claims to be backed by Kotak Mahindra Group, offers Rs 2,000 in Swiggy Money for starting seven SIPs of Rs 250 each. It also promotes SIPs where brands contribute between 5% to 20%.

Is such a scheme allowed under SEBI regulations? SEBI Chief Madhabi Puri Buch has clarified that while SEBI supports initiatives like micro SIPs, any promotion that assures returns is not permitted. The regulator emphasises that such practices go against investor protection principles. Additionally, SEBI has mandated that distributors will receive incentives only after 24 months of continuous SIP investments.

What does this mean for investors? How does SEBI plan to regulate such marketing strategies? Tune in to Business Today TV for expert insights on this evolving issue.