Rajiv Gandhi Equity Savings Scheme Norms Announced by SEBI

The market regulator SEBI (Securities and Exchange Board of India) has announced the norms of Rajiv Gandhi Equity Savings Scheme (RGESS), a government initiative introduced to attract small investors in the capital market.

SEBI in its circular announced that, the scheme aimed at encouraging flow of savings in the financial instruments and improve the depth of the domestic capital market. The scheme was introduced in Union Budget 2012-13, which allows investors to avail tax benefits for investing up to Rs 50,000 in stock market. The investor’s gross annual income should be less than or equal to Rs 10 lakh.

For transaction undertaken by investors through RGESS scheme, depositories should seek transactional details from stock market. Stock market shall provide the details on an immediate basis and ensure that a uniform file structure is used for transactions.

As per the notification, eligible securities must be locked for one year in demat account, but in case of any specification, the new investor must submit a declaration to its depository participant within a period of one month.

The list of RGESS eligible stocks/ETFs/ mutual fund schemes must be furnished by the stock exchanges on their websites. Also, the SEBI directed stock exchanges and depositories to create wide publicity among the investors for the schemes.

Source: India Today