New Delhi, Sept. 4 -- Securities and Exchange Board of India (SEBI) issued a consultation paper on Thursday for a proposal to permit net settlement of funds for transactions undertaken by mutual fund schemes in the cash market, aiming to ease liquidity strains while retaining gross settlement of securities.

The market watchdog noted that the initiative seeks to balance business facilitation with regulatory safeguards.

"The proposal is intended to facilitate ease of doing business, improve settlement efficiency and reduce temporary liquidity requirements for mutual fund schemes, while ensuring that existing safeguards relating to delivery-based settlement, scheme-wise accounting, valuation and investor protection remain unaffected," the ...