16.2 History of mutual funds in India
The mutual fund industry can be broadly put into four phases according to the development of the sector.
First Phase - 1964-87
||Establishment of Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by the Reserve Bank of India.
||Unit Scheme 1964 launched.
Second Phase - 1987-1993 (Entry of Public Sector Funds)
||Entry of non-UTI, public sector mutual funds. SBI Mutual Fund was the first followed by Canbank Mutual Fund (Dec 87).
Third Phase - 1993-2003 (Entry of Private Sector Funds)
||Entry of private sector funds. First mutual fund regulations came into being. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first private sector mutual fund registered in July.
||Substitution of prevalent rules by SEBI (Mutual Funds) Regulations 1996.
Fourth Phase - since February 2003
||UTI bifurcated into two separate entities - Specified Undertaking of Unit Trust of India - UTI Mutual Fund, sponsored by RBI, LIC etc.
||Around 40 players. Mutual Fund AUM in India has grown to Rs 7,945 bn. by December 2009.