The Association of Mutual Funds in India (AMFI) is set to collect and publicly share data on small systematic investment plans (SIPs), termed “choti SIPs,” starting next month. These plans, which require a minimum investment of ₹250 per month, aim to enhance investor accessibility. Data from these investments will be released in January, coinciding with adjustments made by Registrar and Transfer Agents (RTAs) to facilitate the smooth introduction of choti SIPs across all fund houses.
In an effort to broaden participation, the Securities and Exchange Board of India (SEBI) reduced the minimum SIP amount to ₹250 earlier this year. This new investment option is applicable to most schemes, excluding those focused on debt, high-risk sectoral and thematic categories, as well as small-cap and mid-cap equity schemes.
To manage the higher transaction costs associated with smaller investments, choti SIP payments are restricted to the National Automated Clearing House (NACH) and Unified Payment Interface (UPI) auto-pay modes. RTAs are required to track the first three investments of each choti SIP investor via their Permanent Account Number (PAN), as costs incurred beyond these initial investments will not be subsidized. While Asset Management Companies (AMCs) are permitted to provide additional small-ticket SIPs, discounted rates from intermediaries will apply exclusively to the first three plans.
The costs associated with managing these small SIPs are partially covered by the Investor Education and Awareness Fund, which is designed to alleviate the financial burden on AMCs. Mutual Fund Distributors and online payment platforms receive a fixed incentive of ₹500 from AMCs for onboarding new investors through choti SIPs, contingent on a minimum commitment of five years (60 installments). However, this incentive will only be disbursed after investors have completed 24 installments.
Venkat Chalasani, CEO of AMFI, noted that most mutual funds are currently awaiting RTAs to finalize system modifications necessary for the rollout of choti SIPs. The tracking system for these investments is expected to be operational by the end of this month, with data from December slated for public release in January.
Praveen Shankaran, Chief Operating Officer of KFin Technologies, reported that over 150 SIPs have already been identified as choti SIPs since March. Under the current procedure, RTAs will perform initial validations based on specific criteria, with only eligible PANs being forwarded to Know Your Customer Registration Agencies (KRAs) in batch mode for final confirmation regarding the first three AMCs that have utilized the KYC data.
The classification of SIPs as choti is determined solely based on information received from KRAs.
Published on November 14, 2025.
