Sebi Extends Incentive Timeline to Boost Mutual Fund Investments

Sebi has extended the deadline for the implementation of new incentive structures for mutual fund distributors to March 1, 2026. This move aims to encourage investment inflow from B-30 cities and new women investors. The extension comes following feedback highlighting implementation challenges.

The Securities and Exchange Board of India (Sebi) announced an extension of the timeline for implementing a new incentives structure for mutual fund distributors, now set for March 1, 2026. This change targets individual investors from B-30 cities and women investors, aiming to enhance mutual fund reach and awareness.

Originally, the incentives were scheduled to take effect on February 1, 2026. The decision to push the date comes on the heels of feedback from the industry, citing difficulties in developing the systems necessary for seamless implementation.

The new framework offers a 1% commission on initial investments for distributors, funded from existing allocations for investor education. However, dual incentives are restricted, and certain fund categories like ETFs and short-duration schemes are exempt from this additional commission.

(With inputs from agencies.)