From 16 October 2026, at least 17 fund houses stopped taking fresh money into their gold ETF fund of funds (FoFs). In the affected schemes, new lump sums, switch-ins, new SIP registrations and new STP registrations are blocked. SIPs registered earlier, redemptions and purchases of gold ETF units on NSE or BSE are not affected.

If you were planning a gold SIP before Dhanteras and Diwali, this changes the route you can use, not whether you can own gold. This article covers what is restricted, why it happened, what is confirmed and what is only reported, how gold ETFs and gold FoFs differ on cost and tax, and what to do next. All data is as of 17 October 2026.

Restricted in affected gold FoFs	Still open
Fresh and additional lump-sum investments	Existing SIP and STP instalments registered before the cut-off
Switch-ins from other mutual fund schemes	Redemptions, switch-outs and SWPs
New SIP and STP registrations	Buying and selling gold ETF units on NSE or BSE through a demat account
SIP top-ups or step-ups, at some fund houses	Silver-only and multi-asset funds, reportedly not covered (check each scheme notice)
Bulk direct subscriptions into gold ETFs at HDFC, Kotak and UTI (reported)

Details differ by fund house. Read the notice for your scheme before you act.

A gold ETF is a fund listed on the stock exchange. It holds physical gold, and you buy its units through a demat account like a share. A gold ETF FoF is a mutual fund that does not hold gold itself. It puts your money into a gold ETF, so you can run a SIP through a fund house or app without a demat account, as HDFC Mutual Fund explains. One report says FoFs account for about 34% of the gold assets managed by mutual funds, with ETFs holding the other 66%.

The notices target the FoF route and, at some fund houses, large direct subscriptions into the ETF itself. Trading of ETF units between investors on the exchange continues.

Fund houses issued notices late on 15 October. Moneycontrol reports that ICICI Prudential, Kotak, Axis and Tata issued addenda that day, with Aditya Birla Sun Life, DSP and Invesco India also restricting their gold FoFs. ETV Bharat adds HDFC Mutual Fund to the list. Most notices keep the restriction in place until further notice, and none has given a reopening date. The differences between fund houses are small but matter:

•      Kotak includes step-ups on existing SIPs in the restriction.

•      Tata restricts top-ups.

•      ICICI Prudential restricts IDCW transfer-ins and top-ups to existing SIPs and STPs that feed a gold scheme.

•      Invesco says SIP amounts will revert to the 15 October 2026 base amount when subscriptions reopen. (Moneylife)

•      HDFC, Kotak and UTI halted bulk subscriptions into their gold ETFs, as reported by Reuters via Moneylife.

The notices do not state a reason, as Outlook Money notes. Reuters reported that the move followed a nudge from SEBI, citing a mutual fund executive, and two bullion industry officials confirmed discussions with the regulator. Business Standard quotes fund officials saying the curbs were on SEBI’s instructions. Reports vary between nudge and direction, and in our search we did not find a public SEBI circular. Treat the exact regulatory mechanism as unconfirmed.

The backdrop is the rupee. It has fallen about 7% in 2026 on higher oil prices and foreign selling of Indian equities, per Moneycontrol, and touched a record closing low of 96.35 per dollar in May, per Value Research. Gold is among India’s largest imports, and ETFs must hold physical gold equal to their assets, so heavy ETF inflows can add to import demand.

Data point	Figure	Source
Gold ETF net inflows, September 2026	₹4,450.61 crore, up 71.4% from ₹2,596.70 crore in August	AMFI data via Upstox
Gold ETF inflows, January to September 2026	About ₹45,925 crore, above about ₹42,961 crore for all of 2025	Business Standard
Indian gold ETF holdings	124.4 tonnes, up 31% since December 2025	World Gold Council via Outlook Money
Gold import duty	Raised from 6% to 15% from 13 May 2026	Outlook Money
Gold imports, September 2026	$1.8 billion, down 81.27% year on year	Outlook Money
Gold imports, April to September 2026	$19.27 billion, down 27.32%	Whalesbook
Rupee in 2026	Down about 7%	Moneycontrol

 Two details that are often reported wrongly

•      September was not a record month. The inflow was a seven-month high. Gold ETFs drew an estimated ₹11,700 crore in December 2025, the highest in any calendar month.

•      Imports did not spike. They fell for the second month in a row after the duty hike. A bullion dealer told Reuters the halt looks like a precaution against a jump in October imports, according to investingLive.

Inflows also arrived while domestic gold prices were down nearly 5% in September. That points to diversification buying rather than a rush for safety, a view an analyst at Kotak Neo also gave in the WGC report coverage. SBI Securities’ Sudeep Shah said the curbs aim to limit incremental import demand and are not a bearish signal on gold.

In early June, HDFC, ICICI Prudential, Axis, Nippon India, Tata and Aditya Birla Sun Life capped large gold ETF subscriptions, and SBI followed. Direct subscriptions of ₹25 crore or more into gold ETFs were refused, and lump sums and switch-ins into some gold FoFs were capped at ₹10 lakh per PAN per month. Moneycontrol reports those limits were eased in August.

There is also a silver precedent. In October 2025, fund houses paused lump sums into silver ETF FoFs when silver ETFs traded at premiums of 5 to 10%. Tata resumed on 24 October 2025, and Creso puts the pause at about two weeks. Past pauses ended, but no reopening date has been given this time. Value Research’s Dhirendra Kumar has warned that repeated closures can erode investor confidence in the category.

Gold ETFs bought on NSE or BSE are outside the notices, but you need a demat account and you pay the market price. If demand moves to the exchange, units can trade above the value of the gold they hold, as Moneycontrol warns. Compare the price with the indicative NAV (iNAV) on the fund house or exchange website before buying, and avoid large market orders when a premium is visible.

Feature	Gold ETF	Gold ETF FoF
Demat account needed	Yes	No
Price you pay	Market price, which can differ from NAV	Applicable NAV of the fund
Fresh money today	Open on the exchange	Blocked in affected schemes
Typical expense ratio	About 0.4 to 0.5%	About 0.8 to 1%, as the FoF adds its own cost
Long-term holding period	More than 12 months	More than 24 months
Long-term capital gains tax	12.5%	12.5%
Short-term capital gains tax	Your slab rate	Your slab rate

Sources: Motilal Oswal for expense ratios, HDFC Mutual Fund tax leaflet for tax rules on units bought after 31 March 2025. Cess and surcharge are extra.

Brokerage and demat charges can cut into the ETF’s cost advantage on small amounts, as Business Standard notes. Tax can matter more than cost. Suppose you are in the 30% slab and sell after 18 months with a gain of ₹1,00,000. In an ETF the gain is long term and the tax is ₹12,500. In a FoF it is still short term and the tax is ₹30,000, both before cess and surcharge. Keep the holding period in mind before moving between the two.

1.       Existing gold FoF SIP: no action needed. Instalments continue at the applicable NAV. Check your fund’s notice, because step-ups and top-ups are blocked at some fund houses.

2.       Fix the allocation before choosing the route. Planners typically suggest 10 to 15% of a portfolio in gold as a diversifier. On a ₹20 lakh portfolio that is ₹2 to ₹3 lakh. If you already hold more than your target, use the pause to rebalance rather than add.

3.       If you need fresh gold now, use the exchange with discipline. Open or use a demat account, check the iNAV and split the purchase over several sessions. Multi-asset funds are reportedly not covered by the notices, but they hold equity and debt too, so they do not replace a gold target.

4.       Avoid panic switching. Selling FoF units to move into an ETF can trigger tax and exit load, and FoF units held under 24 months are short term. Our note on the mutual fund behaviour gap shows how reactive decisions cost investors returns.

5.       Plan large amounts differently. New STPs into gold FoFs are blocked, so staging a large sum into gold needs another route. Our guide to lump sum vs STP explains how to stage a large amount, and our view on the Nifty at its 52-week low covers how to treat equity SIPs in a weak market.

6.       Protect first, then add gold. Adequate cover comes before any asset allocation decision. See why you need both term and health insurance.

At SJS Finserve our process is goal-based: protect the family with insurance first, build with SIPs, and add other options where they suit the client. For gold, we check four things:

•      Your total gold exposure across FoFs, ETFs, multi-asset funds and physical holdings.

•      A target allocation based on your goals and time horizon, as in our goal-based investing guide.

•      The cost and tax of each route, including holding periods and exit load.

•      How to stage a large amount without adding avoidable risk.

You can estimate SIP amounts with our calculators, read more on the SJS Finserve blog, see how we work on the wealth advisory page, or contact us for a free consultation to review your gold holdings and overall portfolio.

Can I start a new gold SIP now?

Not in the affected gold ETF FoFs. A gold ETF SIP through a broker with a demat account may still be possible, since exchange purchases are not covered. Check your platform and compare the price with the iNAV.

Will my existing gold FoF SIP stop?

No. Notices say instalments under SIPs and STPs registered before the effective date continue at the applicable NAV. Step-ups or top-ups may be blocked, depending on the fund house.

Can I withdraw my gold fund investment?

Yes. Redemptions, switch-outs and SWPs continue, according to the notices.

Are gold ETFs restricted too?

Exchange trading of gold ETF units continues. Reports say HDFC, Kotak and UTI halted bulk direct subscriptions into their gold ETFs, which mainly affects large investors.

Is this a SEBI ban on gold investing?

No. It is a temporary pause on fresh money in specific schemes. Reports link it to a SEBI nudge or instruction, but we did not find a public circular, and the measure does not stop you from owning or selling gold.

When will the restrictions be lifted?

No date has been given. The June 2026 limits were eased by August, and the 2025 silver FoF pause lasted about two weeks, but neither is a guide to this one.

Is it safe to buy a gold ETF at a premium?

Paying above NAV means paying more than the gold inside the unit is worth, and the gap can close. Compare the market price with the iNAV and avoid chasing units.

How is gold ETF income taxed compared to a gold FoF?

Both are taxed at 12.5% for long-term gains and at your slab rate for short-term gains. The long-term threshold is 12 months for ETFs and 24 months for FoFs.