What is an Indian mutual fund, and who runs it?
An Indian mutual fund is a trust that pools money under SEBI's rules, with five parties doing the work. Here is who does what, how NAV works and how big the industry was in September 2026.
Prepared by Prem Tax and Accounting Corp. Last checked against official sources on November 5, 2026.
An Indian mutual fund is a trust that pools money from many investors and invests it under rules made by SEBI, India's market regulator. Since 1 April 2026 those rules are the SEBI (Mutual Funds) Regulations, 2026, which replaced the 1996 rules. The Five-Hat Fund Map below shows who holds which job, so a notice from India makes sense.
- You buy units of a scheme (one fund). A unit's price is its NAV, the net asset value: what the scheme owns minus what it owes, divided by its units.
- SEBI is the regulator. AMFI, the fund houses' association, is not.
- Each scheme has a Direct plan (no distributor commission) and a Regular plan, each with its own NAV.
- For U.S. tax, Indian funds are usually treated as PFICs: the practitioner view, since no IRS ruling names Indian funds.
Who does what
| Hat | Its job |
|---|---|
| Sponsor | Forms the trust and launches the fund |
| Trustee company | Appoints the fund house and holds the assets in trust on behalf of unit holders |
| Fund house (AMC) | Manages the schemes; SEBI must approve it |
| Custodian | Keeps the securities; must be SEBI-registered |
| RTA | Keeps investor records and sends statements |
| SEBI and AMFI | SEBI makes the rules; AMFI registers distributors and publishes NAVs |
The numbers
| Item | Figure | Date |
|---|---|---|
| Industry assets | Rs 82.64 lakh crore | 30 September 2026 |
| Folios (accounts) | 28.62 crore | 30 September 2026 |
| SIP money in the month | Rs 32,490 crore | September 2026 |
| Fund houses reporting assets | 57 (SEBI's register: 62) | July to September 2026; 4 November 2026 |
| Held at NRI or foreign addresses | 4.07% of assets | 30 September 2026 |
One lakh crore is one trillion rupees.
Data from the AMFI monthly reports
Our checklist
The Five-Hat Fund Map: for each holding, note
- The fund house, scheme, plan (Direct or Regular) and option (Growth or IDCW).
- The folio number, and the e-mail and address on file.
- Whether a distributor sold it or you bought direct.
- Which registrar keeps the records, and whether units sit in a folio or demat account.
Mistakes people make
- Reading NAV as a bargain test. A low NAV is not cheap and a high NAV is not dear.
- Mixing up plans. Direct and Regular lines of one scheme have separate NAVs.
Ask your Indian CA about the India side and a cross-border CPA about your home-country forms. Industry figures change monthly.
Common questions
Is an Indian mutual fund the same as a U.S. one?
Both pool money. An Indian fund is a trust under SEBI's rules, priced in rupees. U.S. tax usually treats it as a foreign corporation called a PFIC.
What is a folio?
It is your account with a fund house, and several schemes can sit in a single folio. AMFI counted 28.62 crore folios on 30 September 2026.
Who regulates Indian mutual funds?
SEBI, under its 2026 Regulations. If a fund house does not resolve a complaint, SEBI's SCORES portal is the next step.
Official sources
- SEBI: Mutual Funds Regulations, 2026 (consolidated to 10 October 2026)
- SEBI: Master Circular for Mutual Funds, 20 March 2026
- AMFI: Indian Mutual Fund Industry
- AMFI: Monthly Report, September 2026
- SEBI: Registered Mutual Funds
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