The Securities and Exchange Board of India (SEBI) has proposed a regulatory framework for investech players who provide execution-only services in mutual fund direct plans.
The market regulator has requested public feedback on the consultation paper until August 12. Users can currently route their investments through a direct plan or a regular plan, which differ in expense ratios and the need for a distributor. The move may require platforms such as Zerodha, Groww, and Paytm Money to register as an intermediary for selling mutual fund direct plans. There is currently no framework in place to allow these platforms to provide execution-only services in direct plans of mutual fund (MF) schemes and to obtain data feeds on such transactions.