SEBI
SEBI Weighs Dual Licences for Mutual Fund Distributors and Advisers
9 October 2026 · Mint
SEBI is reviewing whether individual mutual fund distributors (MFDs) should be allowed to hold a registered investment advisor (RIA) licence, based on recommendations from a working group set up earlier this year. The proposal aims to address the overlap between fund distribution and investment advice but raises concerns about conflicts of interest and compliance costs.
Points to Remember
- A SEBI working group, first mentioned by Chairman Tuhin Kanta Pandey in March, is considering dual licences for individual MFDs.
- Currently, there are 1,048 RIAs and over 100,000 MFDs in India.
- Dual licensing would let individual MFDs offer advisory services, but may create conflicts between commission-based distribution and fiduciary advice.
- Compliance costs would rise for MFDs who choose to become RIAs, requiring a compliance officer and additional record-keeping.
- SEBI Executive Director Manoj Kumar said the working group's recommendations have been submitted and final guidelines will be issued soon.
Why it matters
This could change how mutual fund distributors and investment advisers operate, potentially allowing MFDs to offer broader advisory services. If you deal with MFDs or RIAs, expect clearer rules on advice and commissions, which may affect client interactions and compliance requirements.
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