Direct Mutual Fund Plans Become the Default on AMC Platforms: What Investors Should Know
Since 1 November 2026, mutual fund company websites and apps show direct plans as the default choice for self-directed investors. Existing regular-plan holdings and SIPs do not switch on their own.
From 1 November 2026, digital platforms of asset management companies (AMCs) must show direct mutual fund plans as the pre-selected option for self-directed investors. According to press reports, SEBI Chairman Tuhin Kanta Pandey announced the change on 28 October 2026.
Regular plans remain available. Investors can still buy them through distributors or when they want professional guidance. When an investor on an AMC platform picks a regular plan, the platform must show the higher expense ratio first, according to press reports.
What the rule does not change
- It applies to AMC websites and apps. According to press reports, it does not apply to third-party distributor portals or broker apps.
- It applies to new purchases from 1 November 2026. It does not convert existing regular-plan holdings or running SIPs into direct plans.
- To move existing regular units to direct plans, an investor must start a switch. A switch is a redemption and a fresh purchase. It may trigger capital gains tax and exit loads.
Why direct plans cost less
Direct plans carry no distributor commission. That is why their expense ratio is lower than that of regular plans. Over many years, a small gap in annual cost can add up to a visible difference in the final amount. Compare the expense ratio of both plans in the scheme document before you decide.
What this may mean for BFSI jobs
Sales-led distribution work may shift toward advice and planning as more buyers choose direct plans. Banks, wealth firms and distributors may review how they pay and train their advisers. This is our reading, not a measured hiring trend.
Frequently asked questions
Does the rule change my existing SIP?
No. The rule applies to new purchases on AMC platforms from 1 November 2026. Existing regular-plan holdings and SIPs do not convert automatically.
Can I still buy a regular plan?
Yes. Regular plans remain available, and investors can buy them through distributors.
Sources
Archana Jain
Archana Jain is the Founder and CEO of Finploy Technologies, a recruitment platform built exclusively for banking, financial services and insurance (BFSI) hiring in India and Singapore. She has led Finploy since 2020 and has been Chief Operating Officer of Deeesha Finance & Finploy Finance Employment since 2016. Her work focuses on bank and NBFC hiring: leadership roles, home loan and LAP sales, CASA and retail banking, credit and underwriting, collections and recovery, and relationship management, across 1,500+ locations in India. She reviews Finploy Insights articles before they are published.
