Sebi and AMFI have been working together actively in making the fund industry a transparent one, thereby protecting the interest of the investors. It is now the turn of the market to evolve and mature.

The regulatory environment for the Indian mutual fund industry compares favorably with the regulations in most of the mature and developed financial markets in the world. Considering that the Indian mutual fund industry is rather young and in growth phase, the evolution of the regulatory framework is commendable. Be it the disclosure norms for the scheme's portfolio, daily Net Asset Value (NAV), investor protection or the accounting norms, the Indian mutual fund industry regulations match up to with the best regulated markets in the world. The domestic fund industry has covered a lot of ground in its short history to merit comparisons with the most evolved and developed economies in the world.

The establishment of the Unit Trust of India by an Act of Parliament in 1963 was the first step in setting up the fund industry. The regulatory and administrative control for the UTI were with Reserve Bank of India (RBI). In 1989, public sector banks and insurance companies were allowed to set up mutual funds. The mutual funds thus set up were governed by the RBI guidelines of 1989. Thus, we had UTI governed by the Act of Parliament and the other public sector funds governed by the RBI guidelines. The Securities Exchange Board of India (Sebi) was established 1989 for the regulation of the capital markets in the country. For all intent and purposes the fund industry regulation started in the right earnest with Sebi guidelines for the Mutual Fund Industry in 1993. Except for the existing UTI schemes, which were governed by the Act of Parliament, all the schemes were brought within the ambit of Sebi. The Money Market funds continued to be governed by the RBI.

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