SEBI To Make Direct Mutual Fund Plans Default From November 1, Reviews IPO & SME Listing Rules
Mumbai: The Securities and Exchange Board of India (SEBI) will make direct mutual fund plans the default option on asset management companies’ (AMCs) digital platforms from November 1, 2026.
Investors choosing regular plans will be informed about their higher expense ratios, SEBI Chairman Tuhin Kanta Pandey said at NDTV Profit Ignite’s Diwali event.
Direct Plans
The move aims to improve transparency and help investors understand mutual fund costs. Direct plans generally have lower expense ratios than regular plans because they do not involve distributor commissions.
Pandey said SEBI was focusing on simpler regulations, deeper capital markets, stronger governance, investor protection and technology-driven supervision.
IPO Reforms
SEBI is reviewing rules governing main-board IPOs, follow-on public offers (FPOs), SME IPOs and the Innovators Growth Platform to improve fundraising opportunities for emerging businesses.
The regulator is also examining listing disclosures, mutual fund transaction settlements and REIT and InvIT listing timelines.
SEBI Orders Avadhut Sathe Trading Academy To Refund ₹546.17 Cr Collected Through Unregistered Advisory ServicesIt is working with the Reserve Bank of India to simplify foreign portfolio investor (FPI) compliance requirements.
AI Supervision
SEBI plans to expand artificial intelligence in market surveillance and regulatory compliance.
Its Radar tool, currently used to examine mutual fund advertisements, will cover additional intermediaries. AI-based systems are also being developed to analyse compliance reports and identify potential corporate debt defaults.
Pandey stressed that institutions must remain accountable for AI-driven decisions and investor data protection.
Investor Awareness
According to SEBI’s investor survey, 63 percent of households know about at least one securities market product, but only 9.5 percent participate in markets.
Among existing investors, just 36 percent possess moderate or high market knowledge.
SEBI’s Project Jagruk campaign has generated over 25 crore impressions and 18 crore social media views since October 5.
SEBI Eases Rules For Research Analysts, Removes Mandatory Call Recording Requirement For Institutional InvestorsThe regulator has also flagged over 2.2 lakh instances of misleading online content, with its AI tool Sudarshan identifying more than 40 percent.
Market Expansion
Pandey said India’s equity market capitalisation stands near Rs 470 lakh crore, while mutual fund assets total approximately Rs 83 lakh crore.
Outstanding corporate bonds amount to Rs 61 lakh crore, with REITs and InvITs managing over Rs 10 lakh crore.
India has more than 15 crore unique securities market investors.
Pandey emphasised that future reforms must ensure accessible, efficient and resilient capital markets.
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