Launching the Rajiv Gandhi Equity Savings Scheme (RGESS) in Mumbai on Saturday the Finance Minister P Chidambaram assured that he will bring revisions in the next budget to make the scheme more attractive for the retail investors.
“I have assured the regulators and others that we will take the opportunity in the next budget to revisit that section and in the light of experience gained in designing the RGESS we will make changes to that section so that the scheme becomes more attractive to the retail investor,” said Chidambaram.
Earlier while speaking at the event, UK Sinha, chairman, Securities and Exchange Board of India said that the scheme may prove to be vital to bring in retail investors to participate in the growth of the economy and called for a re-look at this scheme by the government to further modify it so as to make it more sustainable and more beneficial in the long run.
“RGESS is a beginning and we will revisit the provisions in the law to make it more attractive and easier for more and more people to invest,” said Chidambaram adding that within the limitations they have already tried to be creative and allowed mutual funds to come into this scheme.
The Finance Minister also pointed out the need to simplify the regulations in order to make processes workable for the investors and not to frighten them with them. Taking the example of different KYC by different regulators to open bank account and Demat account, he argued that why can’t an investor having a bank account simply go and open a Demat account.
“I think its important that KYC norms for all intermediaries within a market regulator should converge and become one set of KYC. The next step is to converge the KYC norms of different regulators. We cannot have multiple KYC norms for intermediaries and participants who are under one regulator,” said the finance minister. “If I have a bank account why should I not open a Demat account straightaway.”