Abhishek Sinha
In a move prompted by tightening supply and surging investor demand, SBI Mutual Fund has temporarily suspended new lumpsum investments in its SBI Silver ETF Fund of Fund (FoF), effective October 13, 2025.
According to an official notification, the decision was taken due to global supply constraints in the physical silver market and a sharp rise in investor inflows into silver-backed instruments. These factors have made it difficult for the fund to create new ETF units at the indicative net asset value (iNAV), leading to potential price distortions.
What Investors Should Know
The suspension applies to all new lumpsum purchases, including additional investments and switch-ins.
However, the fund clarified that existing Systematic Investment Plans (SIPs), Systematic Transfer Plans (STPs), redemptions, and switch-outs will continue to operate as normal, as outlined in the Scheme Information Document (SID).
The fund house emphasized that this is a temporary measure aimed at protecting investors and maintaining fair valuation within the scheme.
About the SBI Silver ETF FoF
The SBI Silver ETF Fund of Fund is an open-ended scheme that invests primarily in the SBI Silver Exchange Traded Fund (ETF), which tracks domestic silver prices.
The fund’s performance is therefore closely linked to physical silver availability and pricing in the Indian market.
The fund note stated:
“Premiums in domestic silver prices have directly influenced the valuation of the scheme. The suspension is intended to ensure pricing stability and investor protection amid prevailing supply challenges.”
The notice, issued from Mumbai on October 11, 2025, was signed by Nand Kishore, Managing Director and CEO of SBI Funds Management Limited.
Industry Trend: Growing Silver Fund Suspensions
SBI Mutual Fund is the third major fund house to halt fresh inflows into silver-based funds in recent days.
Earlier, both UTI Mutual Fund and Kotak Mutual Fund also announced similar temporary suspensions for their Silver ETF Fund of Fund schemes, citing market volatility and supply-side constraints in the precious metal segment.
Experts believe the wave of suspensions indicates mounting challenges in the global silver supply chain, as strong industrial demand — especially from EVs, solar panels, and AI hardware manufacturing — continues to outpace supply.
Investor Advisory
SBI Mutual Fund has urged investors to remain patient and read all scheme-related documents carefully before making investment decisions. The fund house also reassured that normal operations will resume once market conditions stabilize and silver supply constraints ease.
In Summary:
- Suspension effective: October 13, 2025
- Applies to: All new lumpsum purchases and switch-ins
- Continues: SIPs, STPs, redemptions, and switch-outs
- Reason: Global silver supply shortage and valuation pressure
- Status: Temporary, until further notice
