PMS Exit Load: SEBI Rules and What Each Major House Charges

A PMS exit load is a percentage your portfolio manager deducts when you take money out of the portfolio before a set period has passed. In a mutual fund the charge comes off the value of the units you sell. A PMS has no units, so the charge is worked out on the rupee value you withdraw, whether you close the account or only pull out part of it.

The idea behind a PMS exit load is borrowed from mutual funds. SEBI's investor education page on exit loads describes an exit load as a fee on investors who redeem before a pre-defined period, expressed as a percentage of the redemption value and meant to discourage short-term trading. Outside India the same idea usually goes by the name redemption fee. For a portfolio manager the business case is similar. A concentrated portfolio of 15 to 30 stocks is built on the assumption that the money stays long enough for the thesis to play out. Early exits force the manager to sell holdings, sometimes at a bad time, and cut into the fee base that pays for research.

The stakes have grown. SEBI's Chairman said on 30 September 2026 that portfolio managers' assets, excluding PF and EPFO money, reached about ₹9.2 lakh crore by August 2026, across over 530 managers and around 2.2 lakh discretionary clients, so the exit load in PMS agreements now touches many investors.

This guide covers only the PMS exit load itself: what SEBI allows, which rules apply today, and what named houses actually charge. The step-by-step mechanics of redeeming (notice, liquidation, settlement and timelines) are covered in our separate guide to the PMS exit process.

PMS exit charges were not always capped. Until 2020 they were set by contract, and some were steep.

In July 2019 a SEBI Working Group reviewing the old 1993 portfolio manager regulations reported that exit load "varies from Manager to Manager". Its members said exit loads across portfolio managers ranged from 1% to 8%, applied for up to five years. The group called exorbitant exit loads "not in the interest of investors or the industry" and said exit-load structures needed to be standardised.

Its proposal was a sliding cap on the PMS exit load: a maximum of 3% if the client redeems in the first year, 2% in the second, 1% in the third and nothing after three years. It also proposed that the holding period "shall be from date of each inflow / top ups". That detail matters later in this guide.

SEBI turned most of that proposal into rules in a circular dated 13 February 2020, effective 1 May 2020. Alongside the ban on upfront fees and the 0.50% operating-expense cap, it set the SEBI exit load cap still in force today: 3% of the amount redeemed in the first year of investment, 2% in the second, 1% in the third and no exit load after three years from the date of investment.

As Business Standard reported on 25 August 2020, SEBI also said portfolio managers cannot impose a lock-in on clients' investments but can charge a fee for early exits. That pairing of no lock-in with a capped exit fee is still the basic model for exit load in PMS accounts.

Two December 2021 circulars narrowed who the SEBI exit load cap protects. The first, dated 10 December 2021, excluded co-investment portfolio management services from the exit-load paragraph. The second, dated 21 December 2021, said that for large value accredited investors the quantum and manner of exit load would be set by "bilaterally negotiated contractual terms" rather than the cap.

In June 2022, revised in January 2023, SEBI added a protection on the other side: when a portfolio manager is changing hands, clients must be offered a window to leave with no exit load. In December 2022 a similar zero-load option was attached to changes in how a strategy or benchmark is tagged. All of these now sit together in the Master Circular for Portfolio Managers dated 16 July 2025.

If you are asking what the PMS exit load SEBI rules say as of October 2026, the answer is paragraph 6.1.4 of the July 2025 Master Circular for Portfolio Managers. It is short, and each phrase has a practical effect.

The rule reads: "In case client portfolio is redeemed in part or full, the exit load charged shall be as under". It then sets these ceilings:

Three phrases matter:

• "In part or full" means the SEBI exit load cap applies to partial withdrawals as well as full closures, and a manager can charge on both.
• "Of the amount redeemed" means the percentage applies to what you take out, not to your whole portfolio or your original investment.
• "Date of investment" sets the clock. What it means for later top-ups is discussed in the worked examples below.

These PMS exit load SEBI rules set maximums. A house may charge less, charge only in year one, or charge nothing. It may not charge more, and it cannot extend the load past three years.

Many investors search for a PMS lock-in period. Under SEBI's rules there isn't one. SEBI's FAQ on portfolio managers (updated September 2024) says portfolio managers "cannot impose a lock-in on the investment of their clients", but may charge the applicable exit fee for early exit as laid down in the Master Circular. If a product is described to you as having a "soft lock-in", read it as a PMS exit load and check whether it fits the SEBI exit load cap.

The Master Circular sets two situations in which you must be offered a free exit, whatever your agreement says:

1. Change in control of the portfolio manager. After SEBI gives prior approval, the manager must tell existing clients about the change before it happens and give them an option to exit without any exit load within a period of not less than 30 calendar days from that communication (para 1.5.1.4).
2. Change in strategy or benchmark tagging. Each investment approach is tagged to one broad strategy (Equity, Debt, Hybrid or Multi Asset) and a benchmark. The tagging can be changed only after subscribers are offered an option to exit without any exit load (para 4.6A.5).

Both windows can wipe out the PMS exit load entirely. If your manager is being acquired, or your strategy is quietly moved to a different benchmark, you may be able to leave without paying the charge.

The cap does not cover everyone:

• Large value accredited investors. Under the PM Regulations, this means an accredited investor who has signed an agreement for at least ₹10 crore. Under a 21 December 2021 SEBI circular, their exit load is whatever they negotiate.
• Co-investment PMS clients. Paragraph 6.1.4.2 switches the cap off for co-investment services.

If you fall into either group, the negotiation at signing is your only protection.

Have the new regulations changed PMS exit loads? Not yet, and not for most investors.

On 24 September 2026 the SEBI Board approved the SEBI (Portfolio Managers) Regulations, 2026, which will replace the 2020 regulations. According to SEBI's press release PR 59/2026, the new rulebook is 53% shorter, at 33 pages instead of 70. Board approval is not the same as law, though. Regulations take effect only once they are published in the Gazette, and the press release gives no commencement date for them.

At the time of writing (2 October 2026), SEBI's regulations listing still shows the 2020 regulations, last amended on 3 September 2025, as the current portfolio manager regulations. No 2026 notification appears. The July 2025 Master Circular is still the latest master circular for portfolio managers. So for an investor redeeming today, the 3-2-1-nil cap, its carve-outs and both zero-load exit windows apply exactly as described above.

The press release waives exit-load provisions in one specific place. It creates a new route called the Portfolio Managers Route for Investing in Mutual Fund units (PRIM), which lets portfolio managers invest clients' money in direct plans of mutual funds, ETFs, index funds and Specialised Investment Funds. For PRIM the Board listed a ₹25 lakh minimum ticket, a fixed management fee capped at 1% of AUM (performance fees also allowed) and a "Waiver of Exit Load Provisions".

The July 2026 consultation paper explained why. It proposed that the existing PMS exit-load provisions should not apply to an MF-only PMS "to protect clients from double-charging of exit loads", since the underlying mutual funds can carry their own exit loads.

The press release also proposes a new Independent Fund Manager (IFM) model and a "mandatory exit option for clients if an IFM leaves". It does not say whether that exit will be free of exit load. Until the regulations and any new master circular are published, treat that as unknown.

For a conventional equity PMS, nothing in the press release changes the exit load for PMS clients. Once the regulations are notified, check whether a new master circular carries the 3-2-1 cap forward unchanged.

The table below shows the PMS exit load listed on well-known houses' strategy pages on pmssahihai.com at the time of writing (checked 2 October 2026). Where a house's own website also states the figure, we say so. Listings can lag disclosure documents and fee options can carry different loads, so confirm each row against your agreement and the house's current disclosure document.

Every row is within the SEBI exit load cap. The range runs from nil to the full 3%/2%/1%.

We read the "Lock-in / exit" line on all 656 PMS strategy pages listed in pmssahihai.com's sitemap on 2 October 2026. Of those, 602 had a schedule we could read clearly. The rest showed "NA", a dash or a non-standard format such as a six-month tier.

After nil, the most common schedules were 1% in year one only (93 strategies) and 2% then 1% (54). None of the 602 went above the SEBI cap.

So the 3-2-1 cap is a ceiling that only about one strategy in five actually charges. Pages that say PMS exit loads are "usually 3%, 2%, 1%" describe the maximum, not typical practice.

A PMS exit load is set strategy by strategy, so the house name alone does not tell you much. At Marcellus, the flagship Consistent Compounders carries none while the small-cap Little Champs carries the full 3-2-1. ICICI Prudential lists 1% for one year across most strategies but the full 3-2-1 for PIPE. Axis lists the full schedule on six strategies and a one-year 1% on Emerging Stars.

Within a house, the heavier schedule sometimes sits on the small-cap or niche strategy (Little Champs, PIPE), which fits the higher cost of selling less liquid stocks early. It is not a rule. Motilal Oswal lists a flat 2% in year one on all eight strategies, and White Oak, Invesco and most ASK strategies list nil whatever the market-cap focus.

Our check found at least one conflict. Marcellus Rising Giants is listed at 2% in year one on pmssahihai.com, while Marcellus's own help centre says exit load applies only to Little Champs. One source is out of date, or the figure depends on a fee option or joining date.

The document that binds you is the fee annexure to your own portfolio management agreement, which the Master Circular says must spell out every charge. If a listing, a factsheet and your agreement disagree, your agreement applies.

Working out a PMS exit load is simple once you know which rate applies and to what amount. The examples below are illustrative, assume the rates shown and ignore other costs.

Say you invested ₹60 lakh in March 2026 and, eight months later, withdraw ₹20 lakh to pay for a house. Because the rule covers redemption "in part or full", the PMS exit load applies to the ₹20 lakh:

The same withdrawal can cost anything from nothing to ₹60,000 depending on the house. If you wait until month 13, the 2% and 1% one-year schedules drop to zero and the 3-2-1 schedule falls to 2% (₹40,000).

Top-ups are where the PMS exit load most often catches investors out. Suppose you invested ₹50 lakh in January 2025, added ₹25 lakh in January 2026 and close the whole account in October 2026, when it is worth ₹80 lakh. Assume ₹54 lakh of that comes from the original money and ₹26 lakh from the top-up.

SEBI's rule measures years "from the date of investment" and does not say how to treat later inflows. The 2019 Working Group proposed counting from "each inflow / top ups". Agreements differ, so here are both readings under a 3-2-1 schedule:

• Clock runs per tranche. The original ₹54 lakh is in year two (2% = ₹1,08,000). The ₹26 lakh top-up is in year one (3% = ₹78,000). Total exit load: ₹1,86,000.
• Clock runs from the first investment. The whole ₹80 lakh is in year two (2% = ₹1,60,000).

The difference is ₹26,000 here, and it can be larger. Check which method your agreement uses before you add money to a strategy you might leave within three years.

The exit load is only one of the PMS exit charges you face. When you redeem you may also pay:

• Capital gains tax on every stock the manager sells, because you own the shares directly.
• Brokerage and transaction costs on the liquidation.
• A crystallised performance fee, where the agreement provides for one. For example, Marcellus says Little Champs performance fees are charged at the third anniversary or on redemption if earlier.

These can outweigh the load itself, so compare the PMS exit load with the total cost of leaving.

A PMS exit load is a cost, but the SEBI exit load cap gives investors several protections:

• A known worst case. You can calculate the maximum cost of leaving on the day you sign. No PMS can charge more than 3% of the amount redeemed, and none can charge anything after three years.
• Freedom to leave. Because lock-ins are not allowed, the exit load is a price for leaving, not a ban. You can always leave.
• Proportional charges. Since the charge applies only to the amount redeemed, a ₹5 lakh withdrawal costs a small fraction of what a full exit would.
• Free exit windows. A change in control or a re-tag of strategy or benchmark gives you a zero-load way out.
• Competition below the cap. With 38% of strategies at nil, a low or nil exit load for PMS clients is easy to find and is a fair point to raise when choosing between similar strategies.
• Some discipline. A known cost of leaving can make investors pause before selling after one bad quarter, the short-term behaviour exit loads are designed to discourage.

Most investors first look at the exit load when they want to leave, after the schedule is fixed. PMS Sahi Hai puts it in front of you at the point of choice.

The exit line is on every strategy page. Each PMS strategy page on pmssahihai.com shows a "Lock-in / exit" line next to the minimum investment and the fee terms. The house-by-house table and the 602-strategy count in this guide were built from those pages. Rather than reading one factsheet at a time, you can open the PMS strategy listings, filter by fund house or category, and shortlist up to four strategies to compare side by side. Two similar strategies can differ by a full 3-2-1 schedule, and you see it before you invest.

Nyra reads the documents and cites them. Nyra, PMS Sahi Hai's AI analyst, is described as grounded only in SEBI, AMC and IFSCA primary sources. It cites its working on every answer and declines to answer when there is no verifiable source. As the Rising Giants conflict shows, an exit-load figure is only as good as its document. You can ask Nyra what a strategy charges to leave and what the SEBI exit load cap allows, and get the source with the answer. Nyra is an analytical tool, not a SEBI-registered investment adviser, so treat its output as research.

A scan of what you already own. If you already hold a PMS and are weighing a switch, the portfolio scan reviews returns, risk, manager tenure and fees, including what the page calls "the full load: fixed, performance, and the hidden drag". That gives you the cost of staying to set against the PMS exit charges of leaving.

No extra layer of exit charges. On its fees page, PMS Sahi Hai says it is an APMI-registered distributor paid a trail by the asset manager, with ₹0 upfront commission, no advisory fee charged to you and no exit load of its own. The portfolio manager's exit load, as disclosed in your agreement, still applies. The platform does not add one on top.

The SEBI exit load cap has real limits:

• The ceiling is generous. 3% of a ₹1 crore redemption is ₹3 lakh. About one strategy in five still charges the full schedule.
• Top-up timing is unclear. The rule says "date of investment" and does not mention top-ups, so per-tranche clocks are allowed and can push part of an older portfolio back into year one.
• No protection for the largest clients. Clients with ₹10 crore+ accredited agreements and co-investment clients negotiate without a cap.
• Listings can conflict with the agreement. The Marcellus Rising Giants case shows that a figure on one website may not match another. Only your signed agreement is binding.
• It can keep you in an underperformer. Staying in a lagging strategy to dodge a 2% charge can cost more than the charge itself.
• PMS exit charges stack. Tax, brokerage and any performance fee come on top, and the cap limits only the load.

Before you send a redemption request, check these points on your PMS exit load:

1. Find your fee annexure. Note the exit-load schedule and whether it runs per tranche or from the first investment.
2. Date each inflow. List every investment and top-up date so you know which year each tranche is in.
3. Check the calendar. If you are a few weeks from an anniversary, waiting may cut the rate or remove it.
4. Look for a free window. Has the manager announced a change in control, or changed the strategy or benchmark tagging? If so, ask for the zero-load exit.
5. Consider a partial exit. If you need only part of the money, redeem only that amount. The load applies to what you take out.
6. Add up the other exit costs. Estimate tax on realised gains, brokerage and any performance fee due on redemption.
7. Compare against staying. Weigh the one-off exit cost against the expected shortfall of staying in a strategy you no longer believe in.

For now, the PMS exit load SEBI rules are settled. Until the PM Regulations 2026 are notified and a new master circular follows, the July 2025 Master Circular governs: a maximum of 3%, 2% and 1% of the amount redeemed in years one to three, nil after that, free exit windows on a change in control or a strategy re-tag, and no cap for large accredited and co-investment clients. The only exit-load change the Board has announced is a waiver for the new mutual-fund route, PRIM.

Practice differs widely. Across 602 strategies, 38% charge nothing and only about one in five charges the maximum. Exit load in PMS products is therefore worth comparing at the point of choice, not just at the point of exit. PMS Sahi Hai shows the exit schedule on every strategy page, and Nyra can trace each figure back to its source, so you can compare exit terms before you invest.

A PMS exit load is a small number with large consequences, and the time to compare it is before you sign, not when you want to leave.

• Shortlisting a new PMS? Open the PMS strategy listings on PMS Sahi Hai and check the "Lock-in / exit" line next to returns and fees before you pick.
• Thinking of switching? Run your current holdings through the Nyra portfolio scan to set the cost of staying against the exit load of leaving.
• Want a second opinion on your agreement? Ask Nyra about any strategy's exit terms, or book a private consultation with the PMS Sahi Hai team. You pay no upfront fee and no exit load from us.