BSE StAR MF stands for BSE Ltd.’s online Stock exchange platform for Allotment and Redemption of Mutual Fund units.
In order to extend the convenience that investors in the secondary market have, to investors in Mutual funds, a SEBI Committee under the chairmanship of Mr. K N Vaidyanathan, ED - FII & MF, SEBI consisting of representatives from Exchanges, industry and depositories was set up to consider the feasibility of allowing Stock Exchanges (SEs) to offer their existing infrastructure for buying and selling of MF units, in addition to the prevailing distributor / Independent Financial Advisor route.
This culminated in SEBI issuing a circular on November 13, 2009 enabling this route and giving guidelines to all stake holders on the facility of collecting applications for Mutual Fund transactions through Stock Exchanges. BSE’s online mutual fund transaction platform - BSE StAR MF was launched on December 4, 2009 in the presence of SEBI Chairman Mr C B Bhave and several CEOs of leading Mutual Funds.
Some of the key benefits of transacting through this platform are:
Reduction in paper work: Although the platform allows both physical and demat forms of holding ofr MF investments, it is more amenable and easier to hold units in dematerialsed form by opening a demat account.
This reduces considerably the hassle and tedium of filling out application forms, giving cheques, depositing them at near by collection centres, getting statements of account (SOA) after few days, etc.
In the existing framework, Demat account holders benefit from much shorter delivery times than Physical account holders as Demat obviates significant amount of paper movement and in case of subscription investors can actually view the units allotted by the AMC to them on the very next day in their demat account (which is also available for viewing online as facilitated by both depositories).
Faster Execution: Allotment by way of Demat credit. Hence investor can get demat units on the next working day following their date of application as well as redemption proceeds as per the respective TATs followed by the RTAs for each scheme.
Convenience: Existing investors can invest through the same channel (brokers) that they use to purchase stocks. Investors have the added convenience of viewing their Mutual fund investments all in one place along with the other investments in a single Demat account.