Ch.9 · KYC and Folio Management · medium

What happens to exit load collected from investors in a mutual fund scheme?

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EXPLANATION

As per SEBI regulations, exit load collected from investors is credited back into the scheme corpus. This benefits remaining investors and is not income for the AMC.

A.It goes to the AMC as income

B.It is credited to the distributor's commission account

C.It is retained in a separate SEBI escrow account

D.It is credited back into the scheme corpus [✓ Correct]

EXPLANATION

As per SEBI regulations, exit load collected from investors is credited back into the scheme corpus. This benefits remaining investors and is not income for the AMC.

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