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NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Fund Distribution and Channel Management Practices

A distributor's mutual fund business is conducted through a sub-broker-like network of agents. A sub-agent of the distributor wants to sell schemes directly to investors. Which statement is correct as per AMFI norms?

A sub-agent selling mutual fund units must have the required NISM certification and appropriate AMFI registration, such as their own ARN or a registration linked to the distributor, and the distributor must ensure this compliance. Having only a PAN card or relying on the principal's ARN alone is insufficient.

  1. AThe sub-agent may sell without any ARN since the distributor holds one
  2. BThe sub-agent must hold a valid ARN or be registered as an employee/sub-distributor with their own AMFI registration, as applicable, and the distributor must ensure complianceCorrect
  3. CThe sub-agent only needs a PAN card
  4. DThe sub-agent needs a SEBI portfolio manager licence

Explanation

Anyone selling mutual fund units must be certified and carry proper AMFI registration (ARN or an employee identification number linked to the distributor). A PAN alone or a PMS licence does not qualify, and relying purely on the principal's ARN is not allowed.

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