Direct mutual fund plans to be the default choice on fund houses' own apps and websites from 1 November, SEBI chief says
SEBI chairman Tuhin Kanta Pandey said on 28 October 2026 that direct plans will be the default option on asset management companies' digital platforms from 1 November. Investors choosing regular plans will be told about their higher expense ratio, he said.
SEBI chairman Tuhin Kanta Pandey said on 28 October 2026 that, from 1 November, the direct plan will be the default option on the digital platforms of asset management companies (AMCs, the fund houses that run mutual funds). That means when an investor buys a mutual fund scheme on a fund house’s own website or app, the direct plan is the one pre-selected. Cafemutual, Business Today and Free Press Journal reported his remarks, made at the NDTV Profit Ignite event in Mumbai.
What a direct plan and a regular plan are
Every mutual fund scheme can be bought in two versions. A direct plan is bought straight from the fund house, with no distributor (an agent or intermediary who sells the scheme and is paid a commission by the fund house). A regular plan is bought through a distributor. The two hold the same portfolio, but the regular plan’s expense ratio is higher. The expense ratio is the yearly fee, shown as a percentage of the money invested, that the fund house charges to run the scheme; it is deducted within the scheme’s value.
What the chairman said
- Direct plans will be the default option on AMC digital platforms from 1 November.
- Investors who choose a regular plan will be informed that its expense ratio is higher, according to Cafemutual and Free Press Journal. Business Today quotes him as saying investors choosing regular plans “must be informed about their higher expense ratio”.
- A second Cafemutual report, headlined as the chairman asking investors to be cautious while buying direct mutual funds, covers the same event. The page opened for this article did not set out what he said on that point.
What is not yet stated
The reports do not name a SEBI circular or give the text of the rule. They do not say whether it covers every fund house, whether it applies to existing investors or only to new purchases, or how the notice about the higher expense ratio will be shown. No figure for the cost difference between the two plans was given in the reports.
Basis of these figures
SEBI’s circulars page (checked on 30 October 2026, showing items up to 27 October) had no circular on this subject, and the primary text was not found. The date, start date and the regular-plan disclosure come from press reports of the chairman’s statement: Cafemutual, Business Today and Free Press Journal. The 28 October date is from Business Today. The explanation of direct and regular plans is general background, not taken from the report. This article reports the statement and does not say which plan suits any investor.