"There is a demand for self-regulatory organizations (SROs) in the MF sector and we are very keen on that and are also hopeful of implementing the same soon," Securities and Exchange Board of India (Sebi) chairman UK Sinha said on the sidelines of a mutual fund summit here.

Sinha also said the regulator is finalizing norms for distributors and investor advisors and they will be issued shortly.

The Sebi chief said although the idea of an SRO has been challenged in court, he is hopeful of its implementation.

The Financial Planning Supervisory Foundation (FPSF), where retired Supreme Court Justice BN Srikrishna is a director, has taken Sebi to court over the SRO matter.

It contends a possible conflict of interest if an industry group that has been protecting the interests of MFs appoints a company as an SRO to regulate its distributors and agents.

Srikrishna chaired the Financial Sector Legislative Reforms Commission, which recommended sweeping changes in financial sector regulations.

Sinha also said pension funds should come into the mutual funds sector and tax benefits should be offered for investors in real estate investment trusts and infrastructure.

The size of the pension market, estimated at over Rs 1.5 trillion in 2010, is expected to rise to over Rs 2 trillion in 2015 and over Rs 4 trillion by 2025.


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