New Delhi, Dec 2 : The National Stock Exchange (NSE) will soon enter into an agreement with depository services provider CDSL, allowing CDSL account holders to trade on the exchange's newly launched mutual fund platform.
"NSE is likely to sign a pact with the Central Depository Services Ltd (CDSL) this week for the just introduced mutual fund service system (MFSS) by the exchange," a market source close to the development told PTI.
Currently, depository settlement is available only for the account holders in National Securities Depository Ltd (NSDL).
On November 30, NSE made its mutual fund trading platform operational beginning with UTI Mutual Fund.
Many other fund houses, including Reliance MF, Tata MF, Birla MF, ICICI Prudential MF, Fidelity, HDFC Mutual Fund, SBI MF, IDFC Mutual Fund, Religare MF and Franklin Templeton are in "advance stage" of talks with NSE for listing their schemes on the exchange platform, the source said.
"Soon these fund houses are likely to finalise their joining on the exchange to make their products available on the new trading platform," the source added.
On the agreement with CDSL, sources said that "NSE's move would enable lakhs of depository account holders of CDSL to be able for trade in mutual funds on the India's largest bourse."
The assets of the mutual fund industry has breached Rs 8 lakh crore level at the end of November.
The National Stock Exchange's new platform enables investors to buy and sell MF schemes through over 1.5 lakh NSE trading terminals in the same way as equity shares are traded through brokers.
After the launch of the new mutual funds trading platform by NSE, Asia's oldest bourse the Bombay Stock Exchange (BSE) also announced its plans to start trading in MFs and is likely to start it from December 4.
It is understood that BSE has tied-up with Tata Mutual Fund for the venture and is in talks with 4-5 other leading fund houses to participate in the platform, a source close tothe development had said.
"BSE is likely to start this platform on Friday and is talking to 4-5 funds to participate in the venture," the source said.
Market regulator SEBI, recently gave its approval for facilitating transactions in MF schemes through stock exchange infrastructure.
"The infrastructure that already exists for the secondary market transactions through the stock exchanges with its reach to over 1,500 towns and cities, through over two lakh stock exchange terminals can be used for facilitating transactions in mutual fund schemes," SEBI had said.
According to SEBI, the stock exchange mechanism would also extend the present convenience available to secondary market investors to mutual fund investors.
Market participants are enthusiastic about MF platform and a number of fund houses are expected to join this facility in the coming days. At present, 37 mutual fund houses areoperating in the country.
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