SEBI plans to enable salaried employees to invest in mutual funds through payroll deductions, streamlining Systematic Investment Plans (SIPs) similar to EPF or NPS contributions.
SEBI has proposed allowing employers to deduct SIP amounts from employees' salaries and invest them directly in mutual funds, subject to explicit employee consent and KYC checks; public comments are open until June 10, 2026. Payroll-linked SIPs reduce discontinuation rates caused by missed mandates or market volatility, making them a lower-friction onboarding tool for first-time retail investors — a model already proven in 401(k)-style pension systems.
SEBI has invited public comments before finalizing the rules
May 25, 2026
03:20 pm
What's the storyThe Securities and Exchange Board of India (SEBI) has proposed a new initiative to allow employees to invest in mutual funds through payroll deductions.
The proposal is part of a larger consultation paper on allowing certain "third-party payments" in mutual funds under regulated conditions.
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