SEBI bars pooled accounts for MF transaction by stock brokers, MFDs, IAs
IANS 05 October 2021
Market regulator SEBI has barred the usage of pool accounts for transactions in units of mutual funds (MFs) on stock exchange platforms.
 
Presently, funds and units of mutual fund schemes move through stock brokers' or clearing members' pool accounts in an aggregate manner to client account or Clearing Corporation/AMC account, as the case may be.
 
This is based on bilateral understanding with AMCs, where a few platforms, including Mutual Fund Distributors (MFDs) and Investment Advisers (IAs), pool the clients' funds into a nodal account and subsequently transfer to AMCs either on per transaction basis or lump sum basis.
 
SEBI has now said that AMCs (asset management companies) shall ensure that MF transactions are executed only if there is a service agreement between the AMC and the service provider or platform.
 
While pooling of funds has been discontinued for MF transactions, this requirement will not apply to the SEBI registered portfolio managers subject to compliance with SEBI (Portfolio Managers) Regulations, 2020.
 
The circular has further said that all MF transactions for subscription should be credited directly from the investors' account into the MF scheme account without any intermediate pooling. For ease of transaction, funds can be routed through payment aggregators authorised by RBI or SEBI recognised clearing corporations, as the case may be.
 
For redemption, funds should be directly credited to the investor's registered bank account from the MF scheme account without any intermediate pooling, SEBI said.
 
The regulator has further clarified through its circular that stock brokers/clearing members facilitating mutual fund transactions will not accept mandates for SIPs or Lumpsum transactions in their name and accept cheque payments from investors issued in favour of the respective SEBI recognised clearing corporations or mutual fund scheme only.
 
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Comments
ganesanjaicare
2 months ago
Good move by SEBI
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