AMFI rules for mutual fund distributors: FAQ
Short answers to the questions mutual fund distributors ask most about AMFI and SEBI rules, as of 4 October 2026. Each answer links to the full guide.
How to become a mutual fund distributor
Can I sell mutual funds without an ARN?
No. Anyone who sells or markets mutual fund units in India, including sub-brokers and sales staff, needs NISM certification and an ARN from AMFI.
How much does it cost to become a mutual fund distributor?
For an individual: about ₹1,500 plus GST for the NISM V-A exam and ₹3,000 plus GST for the MF-only ARN. Renewal of the ARN costs ₹1,500 every 3 years.
Is an ARN enough to start selling?
No. You must also empanel with each AMC. Transactions under an ARN that is not empanelled with that AMC go into the Direct Plan, so you earn no commission.
Can I hold two ARNs?
No. An ARN is linked to your PAN, is permanent and non-transferable, and one distributor cannot hold more than one.
Do I need GST registration as an MFD?
It is optional in law. But since 1 April 2026 commission is paid GST-exclusive, so only GST-registered MFDs who upload a valid invoice receive the GST component.
ARN renewal and EUIN rules
How early can I renew my ARN?
Up to 6 months before expiry. CAMS sends email reminders from 6 months out, and renewal is online only.
What is NISM CPE?
Continuing Professional Education for NISM V-A: a one-day session of about 6 hours with a test at the end. Done within 12 months before expiry, it revalidates your certificate for 3 years from the expiry date.
Do I lose my trail commission if my ARN expires?
Trail is withheld while the ARN is expired. Renew within 3 months and it is released; renew after 3 months and the withheld trail is forfeited.
What happens to a transaction without an EUIN?
It is processed in the Regular Plan and you get 30 days to supply a valid EUIN or move it to Direct. Otherwise commission on that transaction is forfeited permanently.
Does my EUIN change if I change employers?
No. The EUIN is linked to your PAN and stays the same across job changes.
AMFI Code of Conduct
Where is the AMFI Code of Conduct for MFDs?
The 2022 revision of the Code is Chapter 7 of the AMFI Master Circular for Mutual Fund Distributors dated 14 January 2026.
Can an MFD share part of the commission with a client?
No. Rebating or passing back commission is banned, and so are gifts or vouchers used as an inducement.
Can an MFD promise returns?
No. The Code bars indicative portfolios, indicative yields, and indicative or assured returns.
Can I make my own brochure for a scheme?
Only AMC-provided marketing material may be used. Your own scheme material or AMC logos need the AMC's written approval.
What happens if an MFD breaks the Code?
The AMC reports the breach to AMFI and SEBI and stops dealing with the MFD, and AMFI can suspend or cancel the ARN.
MFD commission rules 2026
Do mutual fund distributors get upfront commission?
No. Only trail commission is allowed, paid in money. Upfront commission and upfronting of trail are banned in any form.
How is GST handled on MFD commission from 2026?
From 1 April 2026 commission is paid GST-exclusive. Unregistered MFDs get the base amount; GST-registered MFDs get GST after uploading a valid invoice by the 15th.
What is BER in mutual funds?
Base Expense Ratio, introduced by SEBI MF Regulations 2026. It covers fund management, distribution, RTA and trade execution. TER is BER plus brokerage plus statutory levies.
Can I earn commission on my own mutual fund investment?
Not where you are the first holder; that is a SEBI violation. Commission is paid if you are the second or third joint holder.
Are transaction charges still paid to MFDs?
No. SEBI abolished the ₹100 and ₹150 transaction charges by circular dated 8 August 2025.
B-30 and women investor incentive
What is the new B-30 incentive for MFDs?
1% of the first year's investment from a new B-30 or new woman investor, capped at ₹2,000 per new PAN, paid after the investor stays invested for one year.
Can I claim both the B-30 and women incentive for one investor?
No. Each new investor qualifies under one path only.
Do liquid fund investments qualify?
No. ETFs, certain fund of funds, and overnight, liquid, ultra-short and low duration funds are excluded.
When did the new incentive start?
It went live on 1 March 2026, after the start date was pushed from 1 February 2026.
MFD vs RIA
Can a mutual fund distributor give investment advice?
Only advice incidental to the mutual fund products they distribute. Personalised advice for a fee needs SEBI Investment Adviser registration.
Can I be both an MFD and an RIA?
Not as an individual: Reg 22(1) bars an individual adviser from distribution. A group must segregate at client level, so one client gets either advice or distribution.
Can an MFD sell Direct Plans?
No. MFDs cannot deal in Direct Plans, and tagging an ARN on a Direct Plan application is a compliance violation.
Can an MFD see a client's Direct Plan holdings?
Not through AMC or RTA feeds. Since June 2024 statements to MFDs cover only that ARN's transactions; Direct Plan feeds go to RIAs with consent.
Is SEBI changing the MFD framework?
A SEBI working group formed in February 2026 is reviewing it, including a possible deemed-RIA route. No report has been published as of 4 October 2026.
Change of ARN and transfer of AUM
Does an investor need an NOC to change their MFD?
No. The investor submits the prescribed form with a verified signature. The change takes effect on T+11 if there is no objection.
When does the new MFD start earning trail?
After a 12-month cooling off period from the change, at the lower of the old and new distributor's rates.
Can I move my AUM when I convert to an LLP or company?
Yes. A change in legal status is one of three cases where a distributor can transfer its whole AUM, at the same commission rate.
What happens to an MFD's trail after death?
The nominee receives it as trustee for the legal heirs until clients move, redeem or AUM is nil. To take over clients, the nominee needs their own ARN within 12 months.
DSC, suspension and penalties
What is the AMFI DSC deadline?
30 June every year. Commission is withheld from 1 July if it is not filed, and forfeited if it is still not filed by 30 September.
What happens to SIPs under a suspended ARN?
They are processed in the Direct Plan permanently, and all commission on the ARN, including past trail, is forfeited.
Does trail continue after I cancel my ARN?
On voluntary cancellation, trail on past business may continue unless it was already suspended. On penal cancellation, no trail is paid.
When does an AMC do due diligence on a distributor?
When the MFD has over ₹100 crore non-institutional AUM, over ₹1 crore commission a year, over ₹50 lakh from one fund, or more than 20 locations.
SIF distribution
Which NISM exam do I need to sell SIF?
NISM Series V-D, which covers mutual funds and SIF together. The NISM XIII route for SIF closed after 21 September 2026.
What does the combined MF and SIF licence cost?
For an individual, ₹5,000 registration and ₹3,000 renewal, plus GST, per AMFI's July 2026 fee table.
I passed NISM XIII. Can I still sell SIF?
Yes, until your certificate expires, provided you also hold a valid NISM V-A.
What happens to my SIF registration if my ARN lapses?
It lapses automatically with the MF ARN or EUIN and revives when you renew.
This guide summarises AMFI and SEBI rules as of 4 October 2026 for information only. It is not legal or regulatory guidance. Rabbit Invest is a software platform for mutual fund distributors and is not an Investment Adviser under SEBI IA Regulations 2013.