Several fund houses stopped fresh lump sums and new SIPs in gold fund-of-funds from October 16, while existing SIPs and redemptions continue. The notices reviewed state no reason; reports link the move to rupee pressure and festive demand.
What Has Been Stopped and What Continues
Fund houses issued notice-cum-addenda late on October 15, effective October 16. ICICI Prudential, Tata and Aditya Birla Sun Life notices, along with a DSP Mutual Fund notice quoted in the press, restrict new money into their gold schemes. Kotak and Axis Mutual Funds are among the other houses reported to have done the same. The exact scope differs by scheme, so each fund’s own notice governs. Aditya Birla Sun Life said applications received up to October 15 would still be processed, and ICICI Prudential said existing instalments registered before the effective date would continue.
| Activity | Status in the notices reviewed |
| Fresh and additional lump sums | Stopped |
| Switch-ins from other funds | Stopped |
| New SIP and STP registrations | Stopped |
| SIP top-ups or step-ups | Stopped at several fund houses |
| Existing SIP and STP instalments | Continue |
| Redemptions, switch-outs and existing SWPs | Continue |
| Gold and silver ETFs | Reported open, per Business Standard |
None of the fund houses has said when subscriptions will reopen. Tata’s addendum describes the suspension as temporary and effective until further notice.
A Fund of Funds Is Not the Same as an ETF
A gold fund of funds does not buy physical gold directly. It invests in a gold exchange-traded fund, which holds the metal. That distinction matters here, because gold ETFs are backed by physical gold, so any additional money flowing into them must be matched by more gold.
Business Standard reported that gold and silver ETFs remain open for investment, while the restrictions apply to the fund-of-funds route. On October 16, gold ETFs held firm and gained up to 1%, according to a Business Standard market report.
Why Fund Houses Acted Now
The addenda reviewed do not explain the decision. Business Standard framed the move as coming amid rupee pressure, and Moneycontrol called the rupee the likely trigger. Both are interpretations, not statements from the fund houses.
The surrounding facts help explain the reading. Gold is among India’s largest imports by value, so heavy buying can affect the trade deficit and demand for foreign exchange. Business Today reported that the rupee closed at about 96.72 against the dollar on October 9 and at 95.05 on October 15, then opened at 94.72 on October 16, following several steps taken in recent days to stabilise it.
Gold Fund Inflows Had Been Rising
Data from the Association of Mutual Funds in India (AMFI) show gold ETFs drew ₹4,450.61 crore in September 2026. That is 71% more than the ₹2,596.70 crore recorded in August. The government also raised the import duty on gold and silver to 15% from 6% earlier this year, according to Moneycontrol.
Festive demand adds to the picture. Gold buying typically strengthens ahead of Dussehra and Diwali, the period in which the restrictions have arrived.
This Is the Second Round of Curbs This Year
Fund houses imposed similar restrictions in June. At that time, HDFC Mutual Fund barred direct subscriptions of ₹25 crore or more into its gold ETF from June 8 and capped lump sums into its gold fund of funds at ₹10 lakh per PAN per month. Business Standard reported that the June curbs came amid a sharp fall in the rupee and a call from the Prime Minister to reduce gold investments. Most fund houses lifted them in the following months.
Earlier this year, the Prime Minister urged citizens to avoid gold purchases for a year, citing national interest. The latest restrictions fit that pattern of repeated, temporary curbs when pressure builds, though the notices themselves do not say so.
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What Existing Investors Should Know
For people already invested, the reports are consistent on the key points. SIPs registered before October 16 continue at their existing amounts, and redemptions, switch-outs and systematic withdrawals continue under each scheme’s terms. The restrictions concern gold ETF fund-of-funds and do not suspend all gold investment products, according to Free Press Journal’s reading of the reports.
New investors cannot start a SIP in an affected scheme while the notice stands. Readers should check the specific scheme notice on the fund house website for the exact permissions, because several fund houses also stopped SIP top-ups, while some notices do not mention them.
