On March 15, 2022, the Securities and Exchange Board of India (SEBI) has issued clarification on discontinuation of usage of pool accounts for transactions in the units of Mutual Funds. This shall come into force on April 1, 2022.

 

Key points:

  • Existing mandates being used for Mutual Fund transactions can continue to remain in the name of the stock brokers/clearing members, subject to Stock Exchanges/Clearing Corporations ensuring that Payment Aggregators (“PA”) has to put in place mechanisms wherein beneficiary of the mandate can only be an Approved Account (which shall only be the bank account of the Clearing Corporation) such that: –

1. PA shall directly credit the monies collected from the bank account of the investor only into an Approved Account

2. PA shall not act on instructions of the stock brokers/clearing members to alter or modify the list of Approved Accounts and in no case the monies shall be credited to the bank account of the stock brokers/clearing members.

  • Existing mandates being used for Mutual Fund transactions can continue to remain in the name of such OTM holders, subject to AMCs ensuring that the PA puts in place mechanisms wherein beneficiary of the mandate can only be an Approved Account (which shall only be the bank account of a mutual fund pool account or mutual fund scheme account) such that: –

1. PA shall directly credit the monies collected from the bank account of the investor only into an Approved Account, with the credit being made as per the mandate/ instruction given to the OTM holder by the client

2. PA shall not act on instructions of the OTM holder to alter or modify the list of Approved Accounts and in no case the monies shall be credited to the bank account of the OTM Holder.

Note: OTM Holders are MFDs / IAs, MFU, channel partners and other entities (including online platforms).

Must Watch

maintenance to second wife

bail in false pretext of marriage

right to procreate of convict

Criminology, Penology and Victimology book release

Join the discussion

Leave a Reply

Your email address will not be published. Required fields are marked *