The U.S. Securities and Exchanges Commission (SEC) Wednesday proposed a couple of possible options for further reforms to money market funds, but the idea still faces industry opposition.

Fitch Ratings reports the SEC approved an initial proposal that recommends two basic reform alternatives. The full proposal will be released in the next few days and subject to a 90-day comment period.

According to the rating agency, the SEC proposals include moving to floating net asset values (NAV) from the fixed NAV of $1.00 that has been the industry standard in the U.S.; and/or measures to ensure liquidity by requiring non-government funds to impose a 2% liquidity fee on redemptions if a fund’s weekly liquid assets fall below 15% of total assets, and allowing fund directors to impose temporary redemption gates. Additional requirements include enhanced diversification, disclosure, and stress testing.

“The SEC’s action is the first step in a process that may or may not result in the adoption and implementation of the proposal,” says Fitch, adding that if any changes are adopted, it likely will not be until 2014 or 2015. Given the uncertainty of the reforms, and the long time to implementation, Fitch is not revising its ratings for funds at this time.

Commenting on the SEC proposals, Timothy Cameron, managing director and head of SIFMA’s Asset Management Group (AMG), said that it “continues to believe that the need for additional regulation is premature in light of the SEC’s 2010 reforms”; still, it added, “we are encouraged that the SEC has limited the scope of its proposal and believe that the imposition of redemption gates and fees is the most effective path forward.”

Cameron said that requiring funds to float net asset values, “would lead to serious negative consequences for the U.S. financial system and the broader economy and would be ineffective in preventing runs.”

“Investors would have fewer choices for cash investing and would lose the benefits of these relatively safe and highly liquid products that provide an attractive alternative to a deposit account. Corporations and financial institutions would find it more difficult and more expensive to access the short-term funding they need to carry out their daily operations, pay their employees and spur the economic growth that creates jobs,” he added.

Cameron added that the SIFMA AMG believes that the SEC’s 2010 reforms “have sufficiently increased the resiliency of [money market funds], as proven by the funds’ ability to withstand unusual market volatility over the past three years in the face of increased Eurozone risks, a U.S. debt ceiling crisis and the first-ever downgrade of the U.S. credit rating.”