This is a news explainer, written with the information available on 18 October 2026.
What happened
On the evening of 15 October 2026, mutual fund houses began publishing addenda to their gold schemes. By the next morning, 17 asset management companies had temporarily stopped accepting fresh investments into their gold fund-of-funds (FoFs). A gold FoF is a mutual fund that invests in a gold ETF, so you can buy gold through a regular mutual fund account or SIP without a demat account.
The cut-off was 3:00 PM or close of business on 15 October for most fund houses (HDFC, Mirae Asset, UTI, Invesco, HSBC, Quantum), and the start of business on 16 October for others such as Axis. Applications received before the cut-off are being processed.
What is paused and what still works
| Paused | Still allowed |
|---|---|
| Fresh lumpsum purchases | Existing SIP and STP instalments |
| Switch-ins from other schemes | Redemptions (selling your units) |
| New SIP registrations | Switch-outs and SWPs |
| New STPs into a gold FoF | Buying gold ETFs on NSE/BSE via demat |
| Top-ups on existing SIPs/STPs | Silver funds and multi-asset funds |
| Dividend (IDCW) transfers in | Units you already hold |
Combined gold-silver FoFs from HDFC, Kotak and Mirae Asset are paused too, because they hold gold. Pure silver funds were open at the time of writing.
Which fund houses
ICICI Prudential, HDFC, Aditya Birla Sun Life, Tata, DSP, Invesco, Zerodha, Nippon India, SBI, Kotak, Axis, Mirae Asset, LIC, Groww, UTI, HSBC and Quantum. More may follow, so check the notice for the specific scheme you hold.
Why now
No fund house or regulator has published an official reason. DSP’s notice refers to “directions received from SEBI”, and industry sources quoted in the press say SEBI asked fund houses to stop fresh inflows. But SEBI had not issued a public circular as of 16 October.
The reported backdrop is India’s foreign-exchange position:
- Gold is almost entirely imported. India spent roughly $72 billion on gold imports in FY26, all paid for in dollars.
- The rupee is under pressure. It hit a record low near ₹97 to the dollar in May and was still around ₹95 in October, with crude oil above $100 a barrel.
- Investment demand kept rising. Gold ETFs took in about ₹4,450 crore in September 2026 alone, up 71% from August, and roughly ₹45,925 crore from January to September, more than in all of 2025.
- Festive demand. Dhanteras and Diwali are traditionally the biggest gold-buying weeks of the year.
How we got here: a 2026 timeline
- 10 May: Prime Minister Narendra Modi asks Indians to avoid buying gold, including jewellery, for a year to save foreign exchange.
- 13 May: Import duty on gold and silver rises from 6% to 15%. With 3% GST, the effective tax on gold goes to about 18.45%.
- June: Fund houses cap gold FoF lumpsums and switch-ins at ₹10 lakh per PAN per month, and refuse large (₹25 crore and above) direct ETF creations. SIPs are left alone.
- Around 21 August: The June caps are lifted after about eleven weeks.
- 7 October: The RBI raises the repo rate by 25 basis points to 5.50%.
- 15–16 October: Gold FoFs stop all fresh money, including new SIPs, until further notice.
This isn’t the first time. In 2013, during an earlier rupee crisis, the RBI barred banks from lending to buy gold, including gold ETF and fund units. In October 2025, fund houses briefly paused lumpsums in silver FoFs because of a physical silver shortage.
What it means for you
If you already have a gold FoF SIP
- Do nothing drastic. Your SIP keeps running at its current amount.
- Don’t cancel it to restart later. New registrations are being rejected, so a cancelled SIP can’t be set up again until the pause ends.
- Step-ups won’t apply while the pause lasts. Invesco, for one, says SIP amounts will revert to the 15 October base amount when subscriptions reopen.
If you wanted to start investing in gold
The FoF route is closed for now, but others remain open, each with its own costs:
- Gold ETFs on NSE/BSE, if you have a demat account. If FoF investors crowd into ETFs, their market price can drift above the value of the gold they hold. Compare the price with the ETF’s iNAV (indicative NAV, shown on the exchange website) before you buy.
- Sovereign Gold Bonds on the secondary market. No new SGB tranche has been issued since February 2024, but existing series trade on the exchanges.
- Physical or digital gold, which now carries the higher 15% import duty plus 3% GST in its price, and making charges on jewellery.
If you want to sell
Redemptions are open as usual. Selling gold units is a capital-gains event, so check what you’d owe before you redeem.
Try the calculatorCapital Gains TaxTax on shares, mutual funds, gold and property sales, with losses set off and carried forward. No salary needed.Keep gold in perspective
A pause on one way of buying gold is a good moment to look at how much gold you actually need. Many financial planners suggest keeping gold to a modest share of a portfolio, often 5–15%, as a hedge rather than the main growth engine. If your gold allocation is already in that range, a temporary pause changes very little.
If you were planning a monthly gold SIP, you can keep the same monthly amount going toward your goal elsewhere while gold funds are shut, and revisit gold when they reopen. The Goal calculator shows what monthly amount a target needs; the SIP calculator shows where a monthly amount can get to.
Try the calculatorGoal CalculatorFind the SIP or lumpsum required to hit a goal. Try the calculatorSIP CalculatorProject the future value of a recurring SIP.Disclaimer
Sources
- Several mutual funds temporarily suspend fresh investments in gold fund of funds, Business Today, 16 October 2026
- Gold FoF inflows paused before Diwali, existing SIPs and withdrawals continue, Free Press Journal
- Curbs on gold funds widen as rupee, reserves face pressure, Press Insider
- Gold and silver fund subscriptions stopped, Creso
- The real reason behind PM Modi’s appeal to Indians not to buy gold for a year, The Tribune
- India hikes gold import duty to 15%, Liquide