In a shock move on Thursday, Franklin Templeton announced the winding down of six of its debt funds that had credit risk. The shutdown kicked in from Friday, April 24.

In this episode of The Wire Business Report, The Wire’s Mitali Mukherjee sheds light on what this unprecedented move, that didn't occur even after the global financial crisis, means.

The last time a scheme was wound down was when market regulator SEBI asked Sahara Mutual Fund to wind up all its schemes in 2018, albeit for very different reasons.

Before anything else, to clarify, if you hold any of these funds, as has been explained, there will be no purchases and redemptions made in these funds post-the cut-off time. So, if you are an existing investor in any of these funds, this means that you can no longer redeem your money and your investment is locked in these funds until the fund house makes further payments. Simply put, your money stands locked. You cannot access it.

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