New Delhi, Oct. 10 -- It's been 10 months since markets regulator Sebi introduced MF Lite, a light-touch regulatory framework for mutual fund companies looking to offer only passive funds.

The market for passive funds in India is booming. Total assets under management (AUM) of passive funds increased from Rs.1.56 trillion in FY21 to Rs.2.12 trillion in FY25, according to the Association of Mutual Funds of India (AMFI).

Yet, since its launch in December 2024, there have been no takers for MF Lite, which is open to both new and existing fund houses. New entrants can register exclusively for passive fund management, while existing AMCs can spin off their passive operations into a separate entity to benefit from the relaxed norms and lower ...