Discontinuation of usage of pool accounts for transactions in units of Mutual Funds on the Stock Exchange Platforms

Last updated: 07 October 2021

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The Securities and Exchange Board of India (SEBI) has announced the discontinuation of using pool accounts for mutual fund transactions on stock exchange platforms. Effective April 1, 2022, funds and units will be directly transferred between investors and clearing corporations or AMC accounts, bypassing stock brokers' and clearing members' pool accounts. This change aims to enhance investor protection and streamline transaction processes.

Securities and Exchange Board of India CIRCULAR SEBI/HO/IMD/IMD-I DOF5/P/CIR/2021/635 October 4, 2021 All Recognized Stock Exchanges and Clearing Corporations All Depositories All Mutual Funds All Asset Management Companies (AMCs) All Trustee Companies/ Boards of Trustees of Mutual Funds All Registrar to an Issue and Share Transfer Agents (RTAs) Association of Mutual Funds in India (AMFI) Sir / Madam, Subject: Discontinuation of usage of pool accounts for tran

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FAQ :

SEBI is discontinuing the use of pool accounts for mutual fund transactions. Funds and units will now be directly handled between investors and clearing corporations/AMC accounts, not through stock brokers' or clearing members' pool accounts.

The discontinuation of pool accounts for mutual fund transactions will be effective from April 1, 2022.

For fund pay-in, clearing corporations will directly receive funds from the investor's account. For fund pay-out, funds will be directly made to the investor's account. Stock brokers and clearing members will not handle these funds.

For both demat and non-demat transactions, units will be credited to or debited directly from the investor's demat account or folio account, without passing through the pool account of stock brokers or clearing members.

No, stock brokers and clearing members are not permitted to accept mandates for SIPs or Lumpsum transactions in their name.

Stock brokers will only accept cheque payments from investors that are issued in favour of the respective SEBI recognised Clearing Corporations or mutual fund scheme(s).