MUMBAI : Debt should be boring. But the last month (or, rather, the last twenty months) has been anything but boring for India’s debt mutual funds.
Credit crisis, liquidity crisis, redemption stress, a slew of regulatory raps, and now regulatory changes – the space has seen it all.The biggest jolt – now a topic of angst for 300,000 investors – came on 23 April when the eighth largest Asset Management Company (AMC) shuttered six of its debt schemes.
Franklin Templeton India’s decision was shocking and raised concerns that perhaps debt mutual funds were not immune to the economic slowdown that has followed in the wake of the pandemic.The pain of Franklin’s investors is set to prolong as the process of refunding is now mired in court battles..