AMFI’s latest circular (dated 10 March 2026) introduces several changes to how MFDs operate. Let me cut through the jargon and tell you what actually matters.
What’s Changed
1. Digital KYC is Now Mandatory for All New Folios
Starting April 1, 2026, all new investor onboarding must use Video KYC or Aadhaar-based eKYC. Physical KYC forms will no longer be accepted for fresh folios.
What this means for you: If you’re still using paper forms, you have exactly 15 days to switch. Most platforms (BSE Star MF, MF Central) already support digital KYC.
2. Commission Disclosure Format Updated
AMCs must now provide a standardised commission statement to investors annually. The format includes:
- Trail commission paid to the distributor
- Expense ratio comparison between regular and direct plans
- Total cost of ownership over the investment period
What this means for you: Transparency is increasing. Be proactive — share this information with clients yourself before they receive it from the AMC. Control the narrative.
3. New Investor Protection Measures
- Mandatory cooling-off period of 24 hours for switches above ₹5 lakh
- Enhanced suitability documentation for debt fund recommendations
- Risk profiling must be updated every 2 years (previously 3 years)
What Hasn’t Changed
- Commission structures remain the same
- Trail percentages are untouched
- No changes to ARN renewal process
- B30 incentives continue
The Smart MFD’s Response
Don’t react defensively. Use this as an opportunity:
- Lead with transparency — Send clients a note saying “Here’s what I earn from your portfolio.” The MFDs who do this first build trust that compounds over decades
- Digitise your KYC workflow this week — Not next month
- Update all client risk profiles — Use this as a reason to have a portfolio review conversation
The distributors who see regulation as a moat — not a burden — are the ones who’ll be here in 10 years.
For detailed regulatory updates, bookmark our Insights page — we break down every SEBI and AMFI circular in plain English.