Parag Parikh Liquid Fund

The Parag Parikh Liquid Fund is an open-ended liquid scheme of PPFAS Mutual Fund , regulated by SEBI , allotted on 11 May 2018, that invests in money market and debt instruments maturing within 91 days and held Rs 5,228.31 crore on 30 September 2026. It sits in the A-I cell of the SEBI Potential Risk Class matrix , relatively low interest rate risk and relatively low credit risk, and is benchmarked to the CRISIL Liquid Debt A-I Index.

The scheme is the only pure debt scheme among the seven that PPFAS Asset Management Private Limited runs, and the only one without Rajeev Thakkar on its management team. The September 2026 PPFAS factsheet names Tejas Soman , Mansi Kariya and Aishwarya Dhar as its managers. Its base expense ratio on 30 September 2026 was 0.09 per cent on the direct plan and 0.17 per cent on the regular plan.

For a retail investor the fund does three jobs: it parks cash that would otherwise sit in a savings account, it is the source scheme for a systematic transfer plan into the Parag Parikh Flexi Cap Fund and the other PPFAS equity schemes, and it allows instant redemption of up to Rs 50,000 a day through the Instant Access Facility. AMFI reported 43 liquid funds holding Rs 6,25,847.01 crore on 30 September 2026, so this scheme held 0.84 per cent of the category.

The rules that bind it sit in the SEBI regulations, the SEBI master circular and the scheme documents: the SEBI (Mutual Funds) Regulations 2026, in force from 1 April 2026; the SEBI Master Circular for Mutual Funds of 20 March 2026 (HO/24/13/11(1)2026-IMD-POD-1/I/7602/2026), which consolidates the liquid fund circulars; and the scheme’s own Scheme Information Document of 28 November 2025. Gains on units bought from 1 April 2023 are taxed at slab rate under section 76 of the Income-tax Act 2025, whatever the holding period.

Scheme facts at a glance

The Parag Parikh Liquid Fund’s core particulars on 30 September 2026 are set out below, each taken from the PPFAS factsheet for September 2026 unless a different source is named.

Table 1. Parag Parikh Liquid Fund, scheme particulars. Source: PPFAS Mutual Fund factsheet, September 2026, pages 24 to 27; Key Information Memorandum dated 27 November 2025. As of 30 September 2026.

PPFAS lists the CRISIL Liquid Debt A-I Index as the scheme’s first-tier benchmark. Paragraph 7.22.2 of the 2026 Master Circular, which footnote 209 traces to a SEBI circular of 27 October 2021 numbered there as SEBI/HO/IMD/IMD-II DF3/P/CIR/2021/652, sets a two-tier benchmark structure under which AMFI publishes the first-tier index for each cell of the Potential Risk Class matrix. The A in A-I is the lowest credit risk class and the I the lowest interest rate risk class, which is the cell the scheme’s own documents declare. The PPFAS scheme benchmark registry lists the indices of all seven PPFAS schemes.

SEBI rules for a liquid fund

A liquid fund under SEBI’s categorisation circular SEBI/HO/IMD/DF3/CIR/P/2017/114 of 6 October 2017 may buy only debt and money market securities with a residual maturity of up to 91 days. The Parag Parikh Liquid Fund is bound by that limit and by the further rules SEBI added in circular SEBI/HO/IMD/DF2/CIR/P/2019/101 of 20 September 2019, now consolidated in Chapter 5 of the Master Circular for Mutual Funds of 20 March 2026.

• 20 per cent in liquid assets. Paragraph 5.6.1 requires a liquid fund to hold at least 20 per cent of net assets in cash, government securities, Treasury Bills and repo on government securities. Below that floor, paragraph 5.6.2 bars any further investment until the floor is restored. The 10 per cent rule for other open-ended debt schemes, from circular SEBI/HO/IMD/DF3/CIR/P/2020/229 of 6 November 2020, does not apply to liquid funds.
• No bank deposits. Paragraph 5.6.3 bars liquid and overnight funds from parking money in short-term deposits of scheduled commercial banks pending deployment.
• No structured or credit-enhanced paper. Paragraph 5.6.4 bars debt securities carrying a structured obligation (SO) or credit enhancement (CE) rating, except government-guaranteed paper.
• Issuer and sector caps. The table at paragraph 13.1 caps exposure to one issuer at 10 per cent of NAV, extendable by 2 percentage points to 12 per cent with trustee and AMC board approval. Sector exposure is capped at 20 per cent, with an extra 10 per cent for housing finance companies and 5 per cent for affordable-housing securitised debt. Bank certificates of deposit, government securities, Treasury Bills and AAA paper of public financial institutions and public sector banks sit outside the sector cap.
• Mark-to-market valuation of every holding. Paragraph 10.2.3(a)(i) requires all money market and debt securities to be valued at the average of prices from the valuation agencies. The older practice of amortising paper with less than 30 days to maturity was ended by circular SEBI/HO/IMD/DF4/CIR/P/2019/102 of 24 September 2019, so a page describing a 30-day amortisation rule as current is out of date.

The scheme’s Key Information Memorandum, dated 27 November 2025, adds its own limits inside those rules: 80 to 100 per cent in money market instruments, up to 20 per cent in debt instruments maturing within 91 days, securitised debt capped at 20 per cent, derivatives up to 50 per cent for hedging and portfolio balancing, and no foreign securities or securities lending. The SEBI 2019 framework is explained clause by clause in SEBI liquid fund framework 2019 .

Portfolio on 30 September 2026

The Parag Parikh Liquid Fund held 82.49 per cent of its Rs 5,228.31 crore in certificates of deposit and commercial paper on 30 September 2026, with the rest in TREPS, Treasury Bills, state government loans, one non-convertible debenture and units of the Corporate Debt Market Development Fund.

Table 2. Parag Parikh Liquid Fund asset mix. Source: PPFAS Mutual Fund factsheet, September 2026. As of 30 September 2026.

By rating, 84.69 per cent was A1+ or AAA, 4.98 per cent sovereign, 10.04 per cent in TREPS and 0.29 per cent in CDMDF units. The factsheet states that every holding was rated AAA on the long-term scale or A1+ on the short-term scale. Commercial paper issuers named in the September 2026 portfolio include Exim Bank, SIDBI, NABARD, Power Finance Corporation, LIC Housing Finance, Tata Capital, Bajaj Finance, ICICI Securities, HDFC Securities and Kotak Securities.

The KIM provides for 25 basis points of assets in Corporate Debt Market Development Fund units; the holding stood at 0.29 per cent of the smaller month-end net assets. The Macaulay and modified duration figures of 0.1422 and 0.1336 years, and the yield to maturity of 6.27 per cent, exclude the CDMDF units, per the factsheet note.

Returns against the benchmark

The Parag Parikh Liquid Fund’s direct plan returned 6.41 per cent in the year to 30 September 2026, against 6.21 per cent for the CRISIL Liquid Debt A-I Index, but trailed the index over three years, five years and since inception.

Table 3. Parag Parikh Liquid Fund returns. Compound annual growth rate for periods over one year. Source: PPFAS Mutual Fund factsheet, September 2026. As of 30 September 2026.

The gap between the direct and regular plans is 0.10 to 0.11 percentage points over every period shown, close to the 0.08 percentage point difference in base expense ratio on 30 September 2026. Since inception the direct plan trailed the benchmark by 0.33 percentage points a year. An index carries no expenses and holds no redemption float.

A liquid fund return tracks short-term money market rates, which follow the RBI repo rate . The Reserve Bank of India raised the repo rate to 5.50 per cent on 7 October 2026, after the period in Table 3.

Fund managers

Three debt managers run the Parag Parikh Liquid Fund, according to the PPFAS factsheet for September 2026.

Table 4. Parag Parikh Liquid Fund managers. Source: PPFAS Mutual Fund factsheet, September 2026.

Raj Mehta is not listed as a manager of the scheme in the September 2026 factsheet. Two of the three current managers took charge on 1 September 2025, so the three-year and five-year returns in Table 3 were earned largely under earlier management.

Insiders held Rs 105.97 crore in the scheme on 30 September 2026, per the factsheet’s insiders’ holding disclosure, and the AMC held 1,987.07 units worth Rs 31,32,172.65 under the SEBI skin-in-the-game rule .

Expense ratio and the SEBI cap

The Parag Parikh Liquid Fund charged a base total expense ratio of 0.09 per cent on the direct plan and 0.17 per cent on the regular plan on 30 September 2026, unchanged from August 2026, against a regulatory ceiling of about 1.32 per cent at its asset size.

The ceiling comes from Regulation 66(7)(c) of the SEBI (Mutual Funds) Regulations 2026, in force from 1 April 2026, which sets the slabs for open-ended schemes “other than equity oriented schemes”. SEBI sets no separate cap for liquid funds; the reduced 0.90 per cent cap in Regulation 66(7)(b) covers index funds, exchange-traded funds and funds of funds investing in liquid schemes, not liquid schemes themselves.

Table 5. Base expense ratio slabs for open-ended schemes other than equity oriented schemes. Source: SEBI (Mutual Funds) Regulations 2026, Regulation 66(7)(c). In force from 1 April 2026.

Applied to the September 2026 average AUM of Rs 6,233.40 crore, these slabs allow Rs 82.56 crore a year of base expenses, or 1.32 per cent of assets: a webnotes.in calculation that runs the scheme’s average AUM through each slab in turn; SEBI applies the slabs to daily net assets, so the figure is an approximation. The direct plan’s 0.09 per cent uses about one-fifteenth of that headroom. The cap applies to the base expense ratio only; GST and brokerage are charged on top under Regulations 66(9) and 66(10). The full regime, including the equity slabs, which are 2.10 per cent on the first Rs 500 crore, is in mutual fund TER in India , and the direct and regular plan difference is explained in regular versus direct plan .

Exit load

The Parag Parikh Liquid Fund charges a graded exit load on units redeemed within six days of investment and nothing from day 7, under a SEBI rule that makes a graded load compulsory for every liquid fund.

SEBI made the load compulsory through circular SEBI/HO/IMD/DF2/CIR/P/2019/101 of 20 September 2019, now paragraph 5.6.5 of the 2026 Master Circular, which requires a liquid fund to levy an exit load on investors leaving within seven calendar days and to follow the graded minimum that AMFI prescribes in consultation with SEBI.

Table 6. Parag Parikh Liquid Fund exit load. Source: PPFAS Mutual Fund factsheet, September 2026.

On a Rs 10 lakh redemption on day 1 the load is Rs 70. Day 1 is the day of investment if the application and the funds reach PPFAS within the cut-off time, and otherwise the day after allotment. The load, net of GST, is credited back to the scheme, so it accrues to the unitholders who stay invested. The general rules on loads are in mutual fund exit load .

Cut-off times and applicable NAV

A purchase of the Parag Parikh Liquid Fund received with funds before 1.30 pm on a business day gets the NAV of the calendar day before receipt, and a redemption received before 3.00 pm on a business day gets the NAV of the day before the next business day. Both rules are in paragraph 9.4.3 of the SEBI Master Circular of 20 March 2026, originally from circulars SEBI/IMD/DF/19/2010 of 26 November 2010 and 2019/101 of 20 September 2019.

Table 7. Liquid fund cut-off times and applicable NAV. Source: SEBI Master Circular for Mutual Funds, 20 March 2026, paragraph 9.4.3.

The phrase “day immediately preceding” refers to calendar days, which gives the weekend its effect. A redemption received before 3.00 pm on a Friday, with Monday the next business day, is priced at Sunday’s NAV, so the investor keeps the weekend’s accrual. Paragraph 9.4.2(e) assigns a NAV only when both the application and the funds, credited and available for use, arrive before the cut-off, the same applicable NAV rule that governs every other scheme category.

Instant Access Facility

The Instant Access Facility lets a resident individual redeem Parag Parikh Liquid Fund units online for instant credit, up to Rs 50,000 or 90 per cent of the holding in the scheme, whichever is lower, per scheme per day.

SEBI permitted the facility by circular SEBI/HO/IMD/DF2/CIR/P/2017/39 of 8 May 2017, now paragraph 15.11 of the 2026 Master Circular. Paragraph 15.11.1(a) restricts it to online transactions in overnight and liquid schemes by resident individual investors, so a non-resident Indian, a company or a trust cannot use it. A request up to 3.00 pm is priced at the lower of the previous calendar day’s NAV and the NAV of the day of the request; after 3.00 pm, the lower of that day’s NAV and the next calendar day’s.

The money comes from the scheme’s own cash: the Master Circular bars an AMC from borrowing to meet instant redemptions and asks it to hold cash of at least three times the higher of the last one or three months’ daily average instant redemptions. The scheme’s SID records that PPFAS introduced the facility on the SelfInvest website and extended it to the SelfInvest mobile app from 22 January 2024; CashFlex offers it too. The steps are in how to use the PPFAS liquid fund instant access facility .

Plans, options and minimum investment

The Parag Parikh Liquid Fund has a direct plan and a regular plan, each with four options: growth, daily reinvestment of income distribution cum capital withdrawal (IDCW), weekly reinvestment IDCW and monthly IDCW.

The face value is Rs 1,000 a unit, which is why the IDCW options trade near Rs 1,000 while the growth option, which has compounded since May 2018, stood at Rs 1,574.8963 on the direct plan on 30 September 2026. On 28 September 2026 the monthly IDCW paid Rs 4.4065 a unit on the direct plan and Rs 4.3343 on the regular plan. The difference between the options is in IDCW in mutual funds .

Table 8. Parag Parikh Liquid Fund transaction minimums. Source: Key Information Memorandum, 27 November 2025.

The STP minimums are the ones that matter for the scheme’s main use inside PPFAS, moving a lump sum into an equity scheme over several months. A daily STP from this scheme into the Parag Parikh Flexi Cap Fund starts at Rs 1,000. Minimums across all seven PPFAS schemes are compared in PPFAS minimum investments per scheme .

PPFAS CashFlex and other channels

PPFAS CashFlex is a mobile app that PPFAS made available from 21 June 2024 for existing investors to buy and redeem units of two schemes, the Parag Parikh Liquid Fund and the Parag Parikh Arbitrage Fund , with instant redemption available for the liquid fund only.

The launch date and the two-scheme scope come from the PPFAS notice-cum-addendum to the SID and KIM of both schemes, dated 20 June 2024. The SID describes CashFlex as an official point of acceptance of transactions on Android and iOS, with registration by one-time password on an existing folio and an M-PIN for each folio, so a new investor opens the folio elsewhere first. More detail is in PPFAS CashFlex .

The direct plan is also sold through the PPFAS SelfInvest portal , where the SID records the Instant Access Facility as available; the industry platforms are covered in MF Central and MF Utility . The step-by-step route is in how to invest in the PPFAS liquid fund .

Tax on Parag Parikh Liquid Fund units

A gain on Parag Parikh Liquid Fund units bought on or after 1 April 2023 is a short-term capital gain taxed at the investor’s slab rate, however long the units are held, under section 76 of the Income-tax Act 2025 (Act 30 of 2025), in force from 1 April 2026.

Section 76(1) treats the gain on transfer or redemption of an asset in section 76(2) as short-term “irrespective of anything contained in section 2(101) or section 72”, and section 76(2)(a) names “a unit of a Specified Mutual Fund acquired on or after the 1st April, 2023”. Section 76(5)(b) defines a specified mutual fund as one that invests more than 65 per cent of its total proceeds in debt and money market instruments, measured on the annual average of daily closing figures. The PPFAS Tax Reckoner for FY2026-27 lists the Parag Parikh Liquid Fund as a specified mutual fund. Section 76 carries forward section 50AA of the Income-tax Act 1961, which the Finance Act 2023 introduced; the background is in debt mutual fund taxation 2023 .

Table 9. Tax on Parag Parikh Liquid Fund units, individual investors, FY2026-27. Sources: Income-tax Act 2025, sections 76 and 393; PPFAS Tax Reckoner FY2026-27.

The TDS threshold on IDCW is Rs 10,000 in a financial year, carried over from section 194K of the 1961 Act; a resident below the taxable limit can file the nil-deduction declaration covered by section 393(6). The PPFAS Tax Reckoner states that tax is deducted on redemption for non-resident investors. The effect against a bank deposit and a savings account is worked through in liquid fund versus savings account , and the arbitrage fund alternative, taxed as equity, in arbitrage versus liquid fund . Worked computations are in Parag Parikh Liquid Fund tax .

Size within the liquid fund category

The Parag Parikh Liquid Fund held 0.84 per cent of liquid fund assets on 30 September 2026: Rs 5,228.31 crore out of Rs 6,25,847.01 crore across 43 schemes, a webnotes.in calculation from the AMFI monthly report for September 2026 and the PPFAS factsheet.

AMFI’s September 2026 report counted 41,29,998 liquid fund folios and Rs 7,48,041.82 crore of average AUM in the month. Inflows of Rs 5,43,731.22 crore against redemptions of Rs 6,39,474.42 crore left a net outflow of Rs 95,743.20 crore, a one-month swing 18 times the size of the whole Parag Parikh Liquid Fund. The overnight fund category, the other scheme type eligible for the Instant Access Facility, had 40 schemes holding Rs 84,032.57 crore on the same date.

Corrections to figures published elsewhere

Several figures about the Parag Parikh Liquid Fund circulate in a form the scheme documents contradict, including in earlier versions of pages on this site.

• Launch date. The scheme was allotted on 11 May 2018, per the PPFAS factsheet. The date 9 May 2018 is wrong.
• Benchmark. The benchmark is the CRISIL Liquid Debt A-I Index. References to a B-I index are wrong; B is a higher credit risk class than the scheme’s declared A.
• Commercial paper. The scheme holds commercial paper, 41.14 per cent of net assets on 30 September 2026, and its KIM permits it. Statements that it avoids commercial paper are wrong.
• Minimum investment. The first purchase minimum is Rs 5,000, not Rs 1,000; Rs 1,000 is the additional purchase and monthly SIP minimum.
• Valuation. Liquid funds value every holding at market prices. The 30-day amortisation rule was withdrawn by SEBI circular SEBI/HO/IMD/DF4/CIR/P/2019/102 of 24 September 2019.
• Governing regulations. The SEBI (Mutual Funds) Regulations 1996 were replaced on 1 April 2026 by the 2026 regulations; expense limits are now in Regulation 66, not Regulation 52. The scheme’s SID of 28 November 2025 still cites the 1996 regulations because it predates the change.

See also

• PPFAS Mutual Fund
• PPFAS Asset Management Private Limited
• Parag Parikh Flexi Cap Fund
• Parag Parikh ELSS Tax Saver Fund
• Parag Parikh Conservative Hybrid Fund
• Parag Parikh Arbitrage Fund
• Parag Parikh Dynamic Asset Allocation Fund
• Parag Parikh Large Cap Fund
• Parag Parikh Liquid Fund tax
• PPFAS CashFlex
• PPFAS SelfInvest portal
• PPFAS scheme benchmark registry
• PPFAS scheme launch timeline 2013 to 2026
• PPFAS minimum investments per scheme
• Tejas Soman
• Mansi Kariya
• Aishwarya Dhar
• Raj Mehta
• How to invest in the PPFAS liquid fund
• How to use the PPFAS liquid fund instant access facility
• Liquid mutual funds in India
• Overnight mutual fund
• Money market mutual fund
• SEBI liquid fund framework 2019
• SEBI (Mutual Funds) Regulations 2026
• SEBI Master Circular for Mutual Funds 2026
• SEBI scheme rationalisation circular 2017
• Potential Risk Class matrix
• Mutual fund riskometer
• CRISIL liquid fund index
• Corporate Debt Market Development Fund
• Mutual fund TER in India
• Mutual fund exit load
• Applicable NAV
• IDCW in mutual funds
• Systematic transfer plan
• Systematic withdrawal plan
• Yield to maturity in mutual funds
• Macaulay and modified duration
• Debt mutual fund taxation 2023
• Income-tax Act 2025
• Section 194K
• Form 15G and 15H for mutual funds
• TDS on NRI mutual fund redemption
• Liquid fund versus savings account
• Liquid fund versus sweep-in FD
• Arbitrage versus liquid fund
• IL&FS default and debt funds, 2018
• RBI repo rate
• AMFI
• CAMS

External references

• PPFAS Mutual Fund, Parag Parikh Liquid Fund scheme page: https://amc.ppfas.com/schemes/parag-parikh-liquid-fund/
• PPFAS Mutual Fund factsheet, September 2026: https://amc.ppfas.com/downloads/factsheet/2026/ppfas-mf-factsheet-for-September-2026.pdf
• Parag Parikh Liquid Fund Scheme Information Document: https://amc.ppfas.com/downloads/parag-parikh-liquid-fund/sid-parag-parikh-liquid-fund.pdf
• Parag Parikh Liquid Fund Key Information Memorandum: https://amc.ppfas.com/downloads/parag-parikh-liquid-fund/kim-parag-parikh-liquid-fund.pdf
• SEBI Master Circular for Mutual Funds, 20 March 2026: https://www.sebi.gov.in/legal/master-circulars/mar-2026/master-circular-for-mutual-funds_100491.html
• AMFI monthly report, September 2026: https://portal.amfiindia.com/spages/amsep2026repo.pdf
• Income-tax Act 2025, Gazette of India: https://egazette.gov.in/WriteReadData/2025/265620.pdf

References

1. PPFAS Mutual Fund, Monthly Factsheet, September 2026, pages 24 to 27, https://amc.ppfas.com/downloads/factsheet/2026/ppfas-mf-factsheet-for-September-2026.pdf .
2. PPFAS Mutual Fund, Scheme Information Document of Parag Parikh Liquid Fund, dated 28 November 2025, and Key Information Memorandum, dated 27 November 2025.
3. PPFAS Mutual Fund, Notice-cum-addendum to the SID and KIM of Parag Parikh Liquid Fund and Parag Parikh Arbitrage Fund and the SAI, “PPFAS CashFlex”, dated 20 June 2024, https://amc.ppfas.com/downloads/addendum/2024/notice-cum-addendum-ppfas-cashflex.pdf .
4. SEBI, Master Circular for Mutual Funds, HO/24/13/11(1)2026-IMD-POD-1/I/7602/2026, 20 March 2026, paragraphs 5.6, 7.22, 9.4.3, 10.2.3, 13.1 and 15.11, https://www.sebi.gov.in/sebi_data/attachdocs/mar-2026/1774024028162.pdf .
5. SEBI, circular SEBI/HO/IMD/DF2/CIR/P/2019/101, 20 September 2019, on liquid and overnight funds, as consolidated in paragraphs 5.6 and 9.4.3 of the Master Circular of 20 March 2026.
6. SEBI, circular SEBI/HO/IMD/DF3/CIR/P/2017/114, “Categorization and Rationalization of Mutual Fund Schemes”, 6 October 2017.
7. SEBI (Mutual Funds) Regulations 2026, Regulation 66(7), notified 15 January 2026, https://www.sebi.gov.in/sebi_data/attachdocs/jan-2026/1768987928534.pdf .
8. Income-tax Act 2025 (Act 30 of 2025), sections 76 and 393, Gazette of India, https://egazette.gov.in/WriteReadData/2025/265620.pdf .
9. PPFAS Mutual Fund, Tax Reckoner FY2026-27, https://amc.ppfas.com/schemes/Tax_Reckoner_2026-27.pdf .
10. AMFI, Monthly Report, September 2026, row A.I.ii Liquid Fund, https://portal.amfiindia.com/spages/amsep2026repo.pdf .