Sebi tweaks SIF certification exam, removes currency derivatives questions

Mutual fund distributors struggling to pass the distributor exam for specialized investment funds (SIF) have finally found relief.

In a circular issued on Tuesday, the Securities and Exchange Board of India (Sebi) operationalised the new exam for aspiring SIF distributors after industry pushback that the existing NISM Series XIII- Common Derivatives Certification was too difficult and some portions were irrelevant to the product.

The market regulator said the existing exam will be suspended from 21 September and will be replaced with the NISM-Series-V-D: Mutual Fund - Specialized Investment Fund Distributors Certification conducted by the National Institute of Securities Markets (NISM).

Mint had reported in December that Sebi and the Association of Mutual Funds in India (Amfi) were in talks to ease the SIF exam.

An option that was being considered was to remove a portion of currency derivatives from the exam, to ensure that distributors are tested on topics relevant to the SIFs they sell. Sebi does not permit asset management companies (AMCs) to launch SIF products related to this segment.

The new exam does not carry questions on currency derivatives.

The NISM Series XIII- Common Derivatives Certification consisted of three sections: currency derivatives, equity derivatives, and interest rate derivatives.

In February, Sebi launched SIF, a product designed to bridge the gap between retail-focused mutual funds and portfolio management services (PMS) for the rich. The minimum ticket size for an SIF is ₹10 lakh, while that for a PMS is ₹50 lakh. SIF is designed for investors willing to take higher risks than those associated with a mutual fund.

The market regulator has allowed AMCS to launch SIFs in seven strategies. The strategies are Equity Long Short Fund, Equity Ex-Top 100 Long-Short Fund, Sector Rotation Long-Short Fund, Debt Long-Short Fund, Sectoral Debt Long-Short Fund, Active Asset Allocator Long-Short Fund, and Hybrid Long-Short Fund.

The difficulty of the exam also prompted malpractice in the industry. Mint reported in May that a few distribution platforms were allowing unqualified sub-brokers to sell SIFs in violation of norms, as the segment faced a shortage of approved sellers.

The new exam will help distributors sell both SIFs and mutual funds, effectively reducing their testing burden.

To make the change to the new certification smooth, distributors who already have a valid NISM Series XIII - Common Derivatives Certification obtained on or before 21 September 2026 do not need to take the new NISM-Series-V-D: Mutual Fund - Specialized Investment Fund Distributors Certification until their current Series XIII certificate expires. Until then, they must continue to hold a valid NISM Series V-A - Mutual Fund Distributors Certification under the old rules.

On 14 July, NISM issued a circular to introduce the new exam. The test allocates about 45% weightage to topics related to mutual fund distribution. It will also test distributors on equity derivatives and interest rate derivatives.

Apoorva is a Mumbai-based journalist at Mint who covers the Securities and Exchange Board of India (SEBI), tracking the pulse of India’s capital markets, regulatory developments and the people who operate within them. She holds a postgraduate diploma in business and financial journalism from the Asian College of Journalism, where she developed a strong foundation in markets, companies, and economic policy. She began her journalism journey with an internship at Bloomberg, where she worked across beats such as real estate, infrastructure, capital markets, and deals, which helped her understanding of business and finance.<br><br>She is guided by the belief that everything in this world can be explained in simple and fewer words, and that idea shapes how she approaches her writing. She aims to cut through complexity and present nuanced regulatory and financial developments in a way that is both accessible and meaningful to read...