Soon, you may be able to gift mutual funds like vouchers- Sebi proposal
New Delhi, Mar 25, 2026
Under the proposal, the purchaser of Gift PPI can gift the prepaid payment instrument to a recipient, who can then use the instrument to subscribe to mutual fund units, Sebi said
In a move that could make investing simpler and more accessible, Securities and Exchange Board of India (Sebi) has proposed allowing gift cards for mutual fund investments—meaning you could soon gift investments just like you gift shopping vouchers.
The idea is to make it easier for new investors to enter the market, especially those who may find traditional investing processes complicated.
What exactly is being proposed?
Sebi wants to introduce Gift Prepaid Payment Instruments (PPIs)—essentially prepaid cards or digital vouchers that can be used to invest in mutual funds.
Here’s how it would work:
• You buy a gift card (PPI) using your bank account or UPI
• You gift it to someone (family, friend, child, etc.)
• The recipient can use it to invest in mutual fund units
Think of it like gifting money—but with a specific purpose: investing.
Key rules you should know
Sebi has proposed a few safeguards to keep things simple and secure:
• Maximum limit: ₹50,000 per person per financial year
• Funding: Only through bank transfer or UPI (no cash)
• Validity: 1 year from date of issue
• Tracking: Registrars (RTAs) will monitor investments
If the ₹50,000 limit is crossed, the transaction will be rejected and the money refunded.
Traditionally, Gift cards and prepaid solutions have been used in retail purchases and over a period of time their adoption has increased driven by digital payments, offering instant delivery and enhanced security.
The consultation paper comes after the Sebi received a proposal from the Association of Mutual Funds in India (AMFI) to consider allowing Gift PPI as an instrument to invest in units of mutual fund.
According to Sebi, "Gift Card/ Gift PPI is expected to improve financial inclusion through on boarding of new investors in the mutual fund space."
The Securities and Exchange Board of India (Sebi) has sought public comments on the proposals until April 14.
Why Sebi is doing this
According to Sebi, the goal is financial inclusion—bringing more people into the mutual fund ecosystem.
India has seen rapid growth in:
• SIP investments
• Retail participation
But a large population still does not invest in financial markets.
Gift-based investing could act as a “first step” entry point.
[The Business Standard]
