SEBI plans dedicated bond distributor category to pull retail into India's debt market
SEBI is designing a bond distributor framework modelled on the 340,000-strong MF distributor network to deepen retail participation in debt, even as debt funds (₹19.31 tn AUM) lag equity (₹35.8 tn) partly due to slab-rate taxation versus equity's 12.5% LTCG.
SEBI plans a dedicated bond distributor category, mirroring mutual fund distribution, to boost retail debt participation. Official flagged tax disadvantage of debt funds, risks from digitisation, AI-washing, social-media-driven speculation, and mis-selling from aggressive distribution incentives.