Withdrawals and transfers of funds may soon become easier for investors who invest in mutual funds through demat accounts. SEBI is working on a new system to simplify this process.

SEBI has a big plan for demat holders; these rules are about to change. Find out who will benefit.

SEBI New Rules Mutual Fund: Withdrawals and transfers of funds may soon become easier for investors who invest in mutual funds through demat accounts. The Securities and Exchange Board of India (SEBI) is working on a new system to simplify the process so that investors don't need to enter repeated instructions.

In a consultation paper issued on February 5, 2026, SEBI has proposed the introduction of Automated Standing Instructions (ASIs) and also proposed bridging the gap between demat and statement of account (SOA) modes.

This will allow features like Systematic Withdrawal Plan (SWP) and Systematic Transfer Plan (STP) to operate automatically without the need for manual intervention. Currently, demat holders have to submit a new request each time they want to withdraw or transfer funds. 

Which investors will get the most benefit?

If SEBI decides to implement this new system, it will directly benefit those who earn a regular income from mutual funds. Retired individuals, investors relying on systematic withdrawal plans, and those with long-term investments will find this beneficial.

Now, there's no need to repeatedly fill out forms or submit separate requests for monthly or periodic withdrawals. The automated system will automatically credit the funds to the account on schedule, reducing investor hassle and simplifying the process.

The facility will be available without a power of attorney

Currently, many investors grant power of attorney to their brokers for convenience, which reduces their direct control over their investments. SEBI wants standing instructions to be placed directly in the depository system, so that investors maintain control over their funds.

Furthermore, simplifying the process is expected to make this task easier. SEBI believes this move will give investors greater control over their money. However, no date has been set for its implementation yet.