Mumbai, May 21 -- Securities and Exchange Board of India (SEBI) has proposed allowing employers to make consolidated mutual fund investments on behalf of employees through payroll deductions, as part of a broader move to relax third-party payment norms in certain cases while retaining safeguards against money laundering and misuse.

In a consultation paper, the market regulator said the proposal is aimed at balancing "ease of investing in genuine cases" with compliance under the Prevention of Money Laundering Act (PMLA).

"The proposed scenario acknowledges the established practice of employers offering various benefits and savings avenues to their employees. This mechanism would allow AMCs to accept consolidated payments for mutual fund ...