National Commodity and Derivatives Exchange gets SEBI nod to launch mutual fund platform

The National Commodity and Derivatives Exchange (NCDEX) has received in-principle approval from the Securities and Exchange Board of India (SEBI) to launch a mutual fund (MF) transaction platform, marking an initial step ahead of its proposed entry into equity and equity derivatives.

NCDEX said the MF platform will operate independently of equity trading systems, allowing the exchange to roll it out in a shorter time frame.

Clearing and settlement of mutual fund subscription and redemption orders will be handled by National Commodity Clearing Limited (NCCL), a wholly owned subsidiary of NCDEX.

“Introducing a mutual fund platform ahead of our equity launch is a strategic decision,” said Arun Raste, Managing Director and Chief Executive Officer of NCDEX.

He added that mutual funds provide a starting point for investors and can help channel savings into regulated investment avenues.

According to the exchange, the proposed platform aims to expand access to mutual fund investments, particularly in rural and semi-urban areas, through features such as low-denomination systematic investment plans (SIPs). It also seeks to support existing trading members by offering an additional business line and to build a cash-market base prior to the launch of the equity segment.

The move aligns with regulatory efforts to broaden participation in capital markets. Mutual funds allow investors to make relatively small investments while gaining exposure to diversified, professionally managed portfolios through a SEBI-regulated, exchange-operated system.

Established in 2003, NCDEX is a SEBI-regulated exchange primarily focused on commodity derivatives, especially agricultural commodities. The exchange has outlined plans to expand into equities and equity derivatives as part of its longer-term strategy to operate as a multi-segment exchange.