On September 29, mutual fund redemptions will be permitted: Sources
Mutual funds are preparing to designate September 29 as a business day as a result of the last-minute change of the Eid-E-Milad public holiday to September 29. This indicates that investors who submitted redemption requests on September 27 would receive their funds on September 29.
Investors in mutual funds (MF) have been spared the long weekend that will start on September 29. The trade organization for the mutual fund sector, the Association of Mutual Funds of India (AMFI), is about to designate September 29 (Friday) as a business day. Industry sources claim that although a formal notification has not yet been made public, this decision was made earlier today (Thursday).
As a result, even though September 29 is a bank holiday due to Eid, customers who had submitted a redemption request on September 27 (Wednesday) will receive their money that day. Until now, the long weekend and the shutdown of the equities and fixed income markets from September 28 (Thursday) to October 2 (Monday) had investors in a frenzy.
The day of Eid-E-Milad, September 28, was formerly planned to be a holiday. However, the Maharashtra government chose to move the public holiday to September 29 (Friday) in order to accommodate Ganesh Visarjan, the final day of the Ganesh festival.
Therefore, September 29 has been declared a holiday. A bank holiday is usually a day off from work.
A few investors were dissatisfied because they were counting on redemptions to come during the extended weekend and the government's last-minute decision to move the bank Eid-E-Milad holiday by a day.
Requests for redemption submitted on September 27 should, preferably, be fulfilled by September 29. The investors would have received their money on October 3 (Tuesday), due to the last-minute change in public holidays, followed by a weekend and another national holiday on October 2 (Gandhi Jayanti). In light of this, AMFI ruled on September 28 that September 29, although being a bank holiday, would be a business day for MFs.
on order to expedite redemptions on September 29, mutual funds will be able to invest money on the markets and even withdraw it.
The fixed income markets and settlement systems remained closed on September 28, which was marked as a non-business day (a non-business day is when MFs refrain from investing any money in the fixed income markets or enable any redemption). This was due to the initial proposal to declare September 28 as the Eid-E-Milad holiday. Despite the bank holiday being moved back by a day, this, according to MF industry experts, is irreversible.
