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Execution Only Platform

Execution Only Platform:

The Securities and Exchange Board of India (SEBI) directed existing Mutual Funds ‘Execution-Only Platforms’ (EOPs) to obtain registration within three months.

  • Execution only platform (EOP )is a digital or online platform which facilitates transactions such as subscription, redemption and switch transactions in direct plans of schemes of mutual funds.
  • Mutual funds is a financial vehicle that pools assets from shareholders to invest in securities like stocks, bonds, money market instruments, and other assets.
  • Mutual funds are operated by professional money managers, who allocate the fund’s assets and attempt to produce capital gains or income for the fund’s investors.
  • Till now, there was no specific framework available for technology/digital platforms to provide execution-only services in direct plans of mutual fund schemes.
  • As per the new SEBI’s new guidelines, no entity would be allowed to operate as an EOP without obtaining registration from SEBI or the Association of Mutual Funds in India (AMFI).