The Chhoti SIP initiative, launched by the mutual fund industry in February 2025, has seen limited interest from fund houses due to technical challenges, said Venkat N Chalasani, Chief Executive, Association of Mutual Funds in India.
What is the Chhoti SIP scheme and why was it launched?
The regulator, along with industry stakeholders, had designed a subsidised cost structure for small-sized SIPs to make them viable for fund houses to accept low-ticket investments. At present, several mid-sized and small fund houses do not offer such smaller SIP options.
What is causing the delay in Chhoti SIP adoption?
Under current rules, the reduced cost benefit is available only for the first three fund houses with which an investor registers a SIP under the Chhoti SIP category.
However, tracking the number of fund houses linked to an investor's Permanent Account Number (PAN) in real time has proven difficult. Chalasani said this technical issue has slowed adoption but expressed optimism that participation will improve once the problem is resolved. "Not that we have not started it, but the pace will pick up only after the technical issue is fixed," he said.
-- Abhishek Kumar, Business Standard
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