Define Unit Trust of India

Establishment

The Unit Trust of India (UTI) was established by the government of India on 1st February, 1964 under the Unit Trust of India Act, 1963 (the bill was introduced by the then Finance Minister Sri.T.T.Krishnamachari).

Structure

The initial capital of UTI was ` 5 crores which was contributed by Reserve Bank of India (RBI), State Bank of India (SBI), Life Insurance Corporation of India (LIC), Scheduled banks and foreign banks. The management was entrusted to an independent Board of Trustees appointed by the Government.

Objectives

The basic objective of the UTI is to offer both small and large investors the means of acquiring shares in the widening prosperity resulting from the steady, industrial growth of the country.

There are two primary objectives of UTI,

To promote and pool the small savings from the lower and middle income people who cannot have direct access to the stock exchange, and

To give them an opportunity to share the benefits and fruits of prosperity resulting from rapid industrialization in India.

Functions

The main functions of UTI are as follows:

To encourage savings of lower and middle-class people.

To sell units to investors in different parts of the country.

To convert the small savings into industrial finance.

To give them an opportunity to share the benefits of industrialization in the country.

To provide liquidity to units.

Recent Developments and Investment Policies of UTI

UTI Mutual Fund is managed by UTI Asset Management Company Private Limited (Estb: on Jan 14, 2003) appointed by the UTI Trustee Company Private Limited for managing the schemes of UTI Mutual Fund and the schemes transferred / migrated from UTI Mutual Fund. UTI Mutual Fund has come into existence with effect from 1st February 2003. UTI Asset Management Company presently manages a corpus fund of over ` 34,500 Crores. UTI Mutual Fund has a track record of managing a variety of schemes catering to the needs of every class of citizenry. It has a nationwide network consisting 70 UTI Financial Centers (UFCs) and UTI International offices in London, Dubai and Bahrain.