The Association of Mutual Funds in India (AMFI) is advocating for the use of intraday loans from banks to facilitate the purchase of securities. This plea comes after the Securities and Exchange Board of India (SEBI) deferred the implementation of new borrowing regulations to July 15. Initially, SEBI had introduced tighter borrowing rules, allowing fund houses to borrow only for specific purposes such as redemptions and interest payments. The delay was prompted by operational challenges highlighted by asset management companies (AMCs), which rely on intraday borrowing to manage cash flow mismatches between inflows and outflows, particularly in liquid and overnight schemes. Fund managers have expressed concerns that restricting borrowing for purchases could hinder their ability to invest promptly, potentially leading to lost opportunities. While AMFI continues discussions with SEBI, the implications of allowing intraday borrowing for purchases raise credit risk concerns, especially if market conditions shift unfavorably. SEBI's regulations are aligned with the Reserve Bank of India's (RBI) recent clarifications regarding capital market exposure, indicating a broader regulatory recalibration in the financial sector.