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HO/(83)2025-IMD-POD-1/I/152/2025

circulars · 1992 · State unknown

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Parent: THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 (7c4c1f5343adab106c3a94cafc08a5ecf5957ae7)

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CIRCULAR HO/(83)2025-IMD-POD-1/I/152/2025 To All Mutual Funds All Asset Management Companies (AMCs) All Trustee Companies of Mutual Funds Registrar to an Issue and Share Transfer Agents (‘RTAs’) Association of Mutual Funds in India (AMFI) Madam/ Sir, Subject: Additional incentives to distributors for onboarding new individual investors from B -30 cities and women investors Regulation 52(6A)(b) of the SEBI (Mutual Funds) Regulations 1996 provided a framework for incentivizing distributors for new investment/ inflows from beyond top 30 cities (B-30 cities) . Due to concerns of misuse of this framework, based on the feedback received from the industry, it has been decided to revise the incentive structure for distributors for bringing in new investment/ inflows in the Mutual Funds. Therefore vide gazette notification dated October 31, 2025, the Regulation 52(6A)(b) of the SEBI (Mutual Funds) Regulations 1996 has been deleted. However, in order to encourage mutual fund distributors to expand their outreach and create awareness among new investors, in terms of Regulation 52(4A) of SEBI (Mutual Funds) Regulations, 1996 the mutual fund distributors shall be eligible for additional commission in the following manner - November 27, 2025 3.1. New investments / inflows eligible for the additional commission – 3.1.1. New individual investors (new PAN) from B-30 cities, at the mutual fund industry level; 3.1.2. New women individual investors (new PAN) from both Top 30 and B -30 cities. 3.2. Incentive Structure: 3.2.1. AMCs shall pay additional commission to distributors for onboarding eligible new investors, subject to the conditions specified in para 3.1 above . 3.2.2. The structure of such additional commission shall be as under: 3.2.3. The additional distribution commission shall

Rule TOC

3 · 1. New investments / inflows eligible for the additional commission –
3 · 1.1. New individual investors (new PAN) from B-30 cities, at the mutual fund industry level;
3 · 1.2. New women individual investors (new PAN) from both Top 30 and B -30 cities.
3 · 2. Incentive Structure:
3 · 2.1. AMCs shall pay additional commission to distributors for onboarding eligible new investors, subject to the conditions specified in para 3.1 above .
3 · 2.2. The structure of such additional commission shall be as under:
3 · 2.3. The additional distribution commission shall be paid from the 2 basis points on daily net assets, mandated to be set apart annually by AMCs for investor education , awareness and financial inclusion initiatives, subject to adequate claw back provisions.
3 · 2.4. The additional commission specified at para 3.2.2 shall be in addition to the existing trail commission paid to the distributor from the scheme.
3 · 2.5. Distributors shall be eligible to receive the additional commission for mobilizing investments from new women investors from Top-30 cities and in cases where the commission for new investment from B -30
3 · 3. Investment in scheme not eligible for additional commission:
3 · 3.1. Exchange Traded Funds (ETFs);
3 · 3.2. Fund of Funds (domestic) with more than 80% of Assets Under Management (AUM) invested in domestic funds;
3 · 3.3. Schemes having duration requirement of less than one year:
HO/(83)2025-IMD-POD-1/I/152/2025 — THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 — Roop's Law Assist Statutes