Change in cut-off timings to determine applicable NAV with respect to repurchase/redemption of units in overnight schemes of Mutual Funds
Summary
SEBI modifies the cut-off timings for determining the applicable Net Asset Value (NAV) when repurchasing units in overnight mutual fund schemes. The amendment introduces a 7 PM online cut-off for overnight funds to facilitate the upstreaming of client funds via pledges. These provisions become effective from June 1, 2025, under powers conferred by Section 11(1) of the SEBI Act.
Text
SB/CMs must upstream clients’ clear credit balances to CCs on an End of Day basis in the form of cash, lien on FD receipts, or pledge of units of Mutual Fund Overnight Schemes.
A Working Group recommended changing cut-off timings to determine applicable NAV for repurchase of units in overnight fund schemes to operationalize the upstreaming of funds via pledge.
Applications received up to 3:00 pm attract the closing NAV of the day immediately preceding the next business day; applications received after 3:00 pm attract the closing NAV of the next business day.
In case application is received through online mode, the cut-off timing of 7 PM shall be applicable for overnight fund schemes.
Business Day does not include a day on which the Money Markets are closed or otherwise not accessible.
The provisions of this circular shall come into force from June 01, 2025.
This circular is issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with regulation 49 of SEBI (Mutual Funds) Regulations, 1996.
Source: SecMarx — Change in cut-off timings to determine applicable NAV with respect to repurchase/redemption of units in overnight schemes of Mutual Funds. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.