PGIM Mutual Fund Suspends Subscriptions In Three International Schemes: What Investors Need To Know

PGIM Mutual Fund has announced that it has temporarily stopped subscriptions to three of its schemes. The mutual fund house made the announcement via a notice issued on July 8. Notably, subscriptions in the schemes will be stopped from today, July 9.

Subscriptions Stopped In Three Schemes

According to the notice, fresh subscriptions into three schemes, PGIM India Global Equity Opportunities Fund of Fund (FoF), PGIM India Emerging Markets Equity FoF, and PGIM India Global Select Real Estate Securities FoF, have been suspended.

The fund house mentioned in the notice that fresh subscriptions have been suspended to comply with the overseas investment limits for mutual funds and to comply with the regulatory guidelines set by the Securities and Exchange Board of India (Sebi).Sebi and the Reserve Bank of India (RBI) have set a ceiling on how much money the entire domestic mutual fund sector can invest overseas.

According to the rule, the entire mutual fund industry can invest a maximum of USD 7 billion in foreign securities. On the other hand, there is an industry-wide limit of USD 1 billion for investing in overseas Exchange Traded Funds (ETFs).Thus, mutual fund houses operate out of a single, shared pool. On the investor’s end, each time they invest money into an international mutual fund anywhere in India, the amount is deducted from the overall USD 7 billion limit.

Once the investments of all fund houses approach the aggregate cap, individual fund houses run out of operational headroom to remit money outside the country.

Once this happens, fundhouses are barred from purchasing more foreign stocks. In order not to breach the investment limit, mutual fund houses halt new subscriptions till sufficient space opens up as existing investors redeem their mutual fund holdings, pulling money out.Notably, this is not the first time the PGIM Mutual Fund has stopped inflows into the scheme. Earlier in March, the fund house halted new subscriptions to these schemes, but later resumed them in May with revised limits.

On June 5, the asset management company limited new systematic investment plan (SIP) registrations at Rs 50,000 per day per investor across these schemes. However, now it has entirely stopped accepting new systematic transfer plan registrations.

What Happens To Existing Investors

For investors looking to make lump-sum investments, the fund house will no longer accept fresh lump-sum purchases or switch-ins during this period. However, existing unit holders are unaffected and can still redeem their units or switch out of these schemes. For SIP investors, no fresh Systematic Investment Plan or Systematic Transfer Plan registrations will be accepted by the fund house. However, instalments under existing SIPs and STPs which were already registered before July 9 will continue to be processed.

Which Other Fund Houses Have Suspended Subscriptions

Given the rally in foreign markets, domestic investors have been on the lookout for ways to capitalise on the same through the mutual fund route. However, to comply with the regulatory guidelines, several other mutual fund houses have also suspended or stopped fresh subscriptions in their international schemes.

Axis Mutual Fund, Nippon India Mutual Fund, Invesco Mutual Fund, and Kotak Mahindra Mutual Fund have paused or capped fresh inflows in 2026. Presently, there are currently only 12 international mutual fund schemes available in which investors can apply for fresh systematic investments.

Outlook Money had earlier reported that the Association of Mutual Funds in India (Amfi) is planning to urge the regulators to increase the mutual fund industry limit for overseas investments. The USD 7 billion limit was originally introduced in 2008 when investor interest in the international market was relatively limited compared to 2026.