Hundreds of thousands of mutual fund investors may have missed out on the stock market rally in the past 10 days, either fully or partly, as glitches at the National Payments Corporation of India (NPCI)—which enables digital payments and settlements—disrupted transactions, reports The Economic Times.
NPCI upgraded its automated payment system on January 31 but problems with implementation resulted in investors not receiving the units they purchased on time, said people aware of the matter. Investors are worried this means they’ve missed out on the post-budget surge in stocks.
Mutual fund industry officials said investors, who bought units through online platforms or digital gateways, have complained that money has been deducted from accounts but units have been received with a delay or not at all.
What has aggravated the problem are Sebi’s new mutual fund rules. These require investors’ money should reach mutual funds before units are allotted against buy orders of over Rs 2 lakh. At least 500,000-700,000 transactions could have been hit, according to unofficial estimates. This could not be independently verified.
Mutual fund executives said the problems didn’t appear to have been sorted out in relation to several transactions as of Monday night. Disgruntled investors are seeking compensation from fund houses for not getting unit allotments on time, said the chief executive officer of a mutual fund.
An executive at a domestic payment gateway firm said most mutual funds did not stop accepting payments either, clogging the system further.