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Who regulates Mutual Funds in India
In summary
Mutual funds in India operate within a regulatory framework overseen by the Securities and Exchange Board of India (SEBI). The framework covers areas such as fund governance, disclosures, investment practices, valuation, and investor grievance mechanisms.
- SEBI is the statutory regulator of mutual funds in India.
- The SEBI (Mutual Funds) Regulations, 2026 came into force on 1 April 2026.
- AMFI is an industry body, not the statutory regulator.
- AMCs manage mutual fund schemes and their investments.
- Trustees oversee the mutual fund and safeguard unit holders' interests.
- Regulation does not guarantee investment returns or prevent market losses.
- The SEBI Riskometer uses six risk categories, from Low to Very High.
- The Bajaj Broking website offers access to 4,000+ mutual fund schemes.
Understanding these roles can help you distinguish regulatory oversight from fund management and industry representation before investing.
Who regulates mutual funds in India?
SEBI regulates mutual funds in India. It is the statutory regulator of the securities market and oversees mutual fund activities through regulations, circulars, and other applicable requirements.
SEBI's mutual fund framework covers areas such as the constitution and management of mutual funds, responsibilities of trustees and AMCs, disclosures, governance, and investor protection. The current SEBI (Mutual Funds) Regulations, 2026 replaced the earlier 1996 framework and came into force on 1 April 2026.
SEBI's role is to establish the rules and monitor compliance. It does not guarantee that a mutual fund will make a profit or prevent the value of your investment from falling.
You can explore mutual funds and begin an SIP through the Bajaj Broking website.
What does SEBI regulate in mutual funds?
SEBI's regulatory framework covers several aspects of how mutual funds operate.
- Registration and governance: Mutual funds and their key entities must meet applicable regulatory requirements before carrying out their functions.
- Scheme disclosures: Investors must receive relevant information about a scheme, including its objective, investment strategy, risks, and costs.
- Investment practices: Mutual funds must follow applicable requirements governing how scheme assets are invested and managed.
- Valuation: SEBI sets requirements for valuing scheme assets so that the calculation of a scheme's NAV follows applicable standards.
- Advertising: Mutual fund communications must follow applicable requirements and should not mislead investors or present market-linked investments as guaranteed returns.
- Investor grievances: The regulatory framework includes mechanisms for addressing investor complaints and protecting unit holders' interests.
You can also learn more about Asset Management Companies, which manage the investments of mutual fund schemes.
How are SEBI, AMFI, AMCs, and trustees different?
These entities have different responsibilities within the mutual fund ecosystem. Understanding the difference can make the regulatory structure easier to follow.
| Entity | Main role |
|---|---|
| SEBI | Regulates the securities market, including mutual funds, and sets the applicable regulatory framework |
| AMFI | Represents SEBI-registered AMCs and promotes professional and ethical standards in the mutual fund industry |
| Sponsor | Establishes the mutual fund, subject to applicable regulatory requirements |
| Trustees | Oversee the mutual fund and safeguard the interests of unit holders |
| AMC | Manages the investments and operations of mutual fund schemes |
| Custodian | Holds the securities belonging to mutual fund schemes |
| RTA | Maintains investor records and processes transactions and related services |
AMFI is not the statutory regulator of mutual funds. It is a non-profit industry body of AMCs registered with SEBI. AMFI also performs certain functions delegated by SEBI, including the registration of mutual fund distributors and assignment of AMFI Registration Numbers (ARNs).
What does mutual fund regulation mean for you?
Regulation gives you access to information and a framework intended to promote transparency and proper governance. Before investing, you can review a scheme's objective, investment strategy, portfolio, costs, and risk information.
The SEBI Riskometer is another useful tool. It shows the risk level assigned to a mutual fund scheme, ranging from Low to Very High. The Riskometer can help you understand the scheme's indicated level of risk, but it does not mean that your investment is protected from losses.
For example, Meera, who is new to investing, finds a mutual fund described as SEBI-regulated. She assumes this means her Rs. 50,000 investment cannot lose value. That assumption is incorrect. SEBI regulation governs how the mutual fund operates and what it must disclose, but the value of Meera's investment can still rise or fall with the market.
Does SEBI regulation guarantee mutual fund returns?
No. SEBI regulation does not guarantee returns, protect you from market fluctuations, or ensure that you will recover the amount you invest.
A mutual fund invests in market-linked securities. If the value of those securities falls, the NAV of the scheme can also fall. This means you can lose part or all of the amount invested, depending on the circumstances.
Regulation and investment risk are therefore two different things. Regulation provides a framework for how funds operate; it does not remove the risks associated with the underlying investments.
What should you check before investing in a mutual fund?
Regulation is one part of evaluating a mutual fund. You should also understand how a particular scheme fits your financial circumstances.
- Check the investment objective: Understand what the scheme aims to achieve and where it invests.
- Review the Riskometer: Check the scheme's current risk level before investing.
- Understand the portfolio: Look at the securities, sectors, or asset classes in which the scheme invests.
- Review the costs: Check the applicable expense ratio, exit load, and other disclosed charges.
Consider your investment horizon: Think about when you may need the money and whether the scheme's risk level is appropriate for that period.
You can compare mutual funds using factors such as risk, returns, expenses, and portfolio details rather than looking at past returns alone.
You can also explore types of mutual funds to understand how equity, debt, hybrid, ELSS, and other categories differ.
What can you do if you have a mutual fund complaint?
If you have a complaint about a mutual fund, AMC, distributor, or another intermediary, you should generally raise the issue with the concerned entity through its grievance mechanism first.
If the issue remains unresolved, you can use the applicable SEBI grievance-redressal mechanism. Keep relevant transaction details, account information, and communication records so that you can provide the necessary information when raising your complaint.
Conclusion
SEBI is the primary regulator of mutual funds in India. Its regulatory framework covers the way mutual funds are established and managed, their governance and disclosures, and mechanisms intended to protect investors.
For you as an investor, regulation can provide greater transparency and a defined framework for oversight. It does not, however, remove market risk or guarantee returns. Use the available scheme information, Riskometer, and disclosures to understand an investment before you decide whether it fits your financial goals.
Last reviewed: September 2026
Mutual funds are subject to market risk. Please read the scheme-related documents carefully before investing.
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Is SEBI the main regulator of mutual funds in India?
Yes. SEBI is the primary regulator of mutual funds in India. It establishes the applicable regulatory framework and monitors compliance by mutual funds and related entities. AMFI has a different role: it is an industry body representing SEBI-registered AMCs and performs certain functions delegated by SEBI. Understanding this distinction helps you know which organisation is responsible for regulation and which represents the mutual fund industry.
Is AMFI a regulator like SEBI?
No. AMFI is a non-profit industry body of AMCs registered with SEBI. It works to develop professional and ethical standards in the mutual fund industry and performs certain functions delegated by SEBI. SEBI remains the statutory regulator. If you are comparing mutual fund schemes on the Bajaj Broking website, you can use scheme-level information and regulatory disclosures to understand the investment before making a decision.
Does a SEBI-regulated mutual fund mean my money is safe?
No. A SEBI-regulated mutual fund is not risk-free. SEBI's framework provides rules covering areas such as governance, disclosures, and investor protection, but mutual funds invest in market-linked securities. Their value can therefore rise or fall. Before investing, check the scheme's Riskometer, investment objective, portfolio, costs, and other scheme-related documents rather than assuming that regulation guarantees the safety or return of your investment.
Can I complain to SEBI about a mutual fund?
You can use the applicable SEBI grievance-redressal mechanism if your concern is not resolved through the mutual fund or intermediary's own grievance process. Keep your transaction details and relevant correspondence available when raising a complaint. This can help you provide a clear record of the issue and the steps you have already taken to resolve it.
Disclaimer
Bajaj Finance Limited ("BFL") is registered with the Association of Mutual Funds in India ("AMFI") as a distributor of third party Mutual Funds (shortly referred as 'Mutual Funds) with ARN No. 90319
BFL does NOT:
(i) provide investment advisory services in any manner or form.
(ii) carry customized/personalized suitability assessment.
(iii) carry independent research or analysis, including on any Mutual Fund schemes or other investments; and provide any guarantee of return on investment.
In addition to displaying the Mutual fund products of Asset Management Companies, some general information is sourced from third parties, is also displayed on As-is basis, which should NOT be construed as any solicitation or attempt to effect transactions in securities or the rendering any investment advice. Mutual Funds are subject to market risks, including loss of principal amount and Investor should read all Scheme/Offer related documents carefully. The NAV of units issued under the Schemes of mutual funds can go up or down depending on the factors and forces affecting capital markets and may also be affected by changes in the general level of interest rates. The NAV of the units issued under the scheme may be affected, inter-alia by changes in the interest rates, trading volumes, settlement periods, transfer procedures and performance of individual securities forming part of the Mutual Fund. The NAV will inter-alia be exposed to Price/Interest Rate Risk and Credit Risk. Past performance of any scheme of the Mutual fund do not indicate the future performance of the Schemes of the Mutual Fund. BFL shall not be responsible or liable for any loss or shortfall incurred by the investors. There may be other/better alternatives to the investment avenues displayed by BFL. Hence, the final investment decision shall at all times exclusively remain with the investor alone and BFL shall not be liable or responsible for any consequences thereof.
Investment by a person residing outside the territorial jurisdiction of India is not acceptable nor permitted.
Disclaimer on Risk-O-Meter:
Investors are advised before investing to evaluate a scheme not only on the basis of the Product labeling (including the Riskometer) but also on other quantitative and qualitative factors such as performance, portfolio, fund managers, asset manager, etc, and shall also consult their Professional advisors, if they are unsure about the suitability of the scheme before investing.
Disclosure: Bajaj Finance Limited (BFL) is a distributor of Mutual Funds with ARN - 90319 and distributes mutual funds of Bajaj Finserv Asset Management Limited (BFSAMC). BFL receives commission towards distribution of mutual fund products. BFSAMC is a group company of BFL, carrying business on arm’s length basis without any conflict of interest and in accordance with the prevailing law / regulation.
Disclaimer
Bajaj Finance Limited ("BFL") is an NBFC offering loans, deposits and third-party wealth management products.
The information BFL contained in this article is for general informational purposes only and does not constitute any financial advice. The content herein has been prepared by BFL on the basis of publicly available information, internal sources and other third-party sources believed to be reliable. However, BFL cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed.
This information should not be relied upon as the sole basis for any investment decisions. Hence, User is advised to independently exercise diligence by verifying complete information, including by consulting independent financial experts, if any, and the investor shall be the sole owner of the decision taken, if any, about suitability of the same.
Disclaimer
Mutual Fund SIP calculator may provide potential investors an approximate estimate on the maturity amount of the monthly SIP, purely based on mathematical calculation of the projected annual return rate selected by investor. However, such calculation does not factor the actual performance by the Asset Management Company (AMC) and should not be treated as any advice or assurance about the actual return of investment. Mutual Funds do not have a fixed rate of return and it is not possible to predict the rate of return. Please note that the SIP calculator are for illustrations only and do not represent actual returns which may vary depending on various factors including but not limited to actual performance, expense ratio, taxation, exit load (if any), etc.