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SEBI MF Circular

Discontinuation of usage of pool accounts for transactions in units of Mutual Funds


 

  1. Pooling of funds and/ or units by stock brokers / clearing members in any form or manner shall be discontinued for mutual fund transactions.

  2. Funds pay-in is directly received by the clearing corporation from the investor account and funds pay-out is directly made to the investor account. Pay-in / pay-out of funds shall not be handled by the stock brokers / clearing members. In the same manner, for both demat and non-demat mode transactions, the units shall be credited and debited directly to/ from the investors’ demat account/ folio account without routing it through the pool account of the stock brokers / clearing members.

  3. It is further clarified that stock brokers / clearing members facilitating mutual fund transactions shall:

  1. Not accept mandates for SIPs or Lumpsum transactions in their name;

  2. Accept cheque payments from investors issued in favor of the respective SEBI recognized Clearing Corporations or mutual fund scheme(s) only;

  3. Not accept or handle funds or units of investors in their proprietary accounts or pool accounts in any form or manner; and

  4. Not accept payment through one-time mandate or issuance of mandates/ instruments in their name for mutual fund transactions. However, one-time mandates in favour of SEBI recognized Clearing Corporations may be accepted.

  1. Stock Exchanges and Depositories are directed to bring the provisions of this circular to the notice of their members / participants and also disseminate the same on their websites.

  2. The provisions of this Circular shall be applicable with effect from July 01, 2022.

  3. This circular is issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with the provisions of Regulation 77 of SEBI (Mutual Funds) Regulations, 1996, to protect the interest of investors in securities and to promote the development of, and to regulate the securities market.