6 days ago
SEBI Scraps Transaction Charges To MF Distributors: What It Means For You
SEBI has removed transaction charges paid by AMCs to mutual fund distributors, effective immediately.
The Securities and Exchange Board of India (SEBI) has announced the removal of transaction charges or commissions paid by Asset Management Companies (AMCs) to mutual fund distributors. SEBI had taken the decision after a public consultation and industry-wide feedback.
The market regulator clarified that the changes will come into effect immediately.
'…SEBI Master Circular for Mutual Funds dated June 27, 2024 (Master Circular) allows AMCs to pay to the distributor transaction charges, subject to a minimum subscription amount of INR 10,000/
– brought in by such distributors," SEBI circular mentioned.
'Based on the feedback received from the industry and considering that distributors as an agents of AMCs are entitled to be remunerated by the AMCs, the charges or commission, as prescribed under the paragraph 10.4.1.b and paragraph 10.5 of Master Circular, shall be done away with."
The decision is expected to impact how AMCs structure their distributor incentives, with a possible shift towards more transparent and performance-linked commission models.
For individual investors, the decision might lead to marginal cost savings, especially for those investing through distributors.
For distributors, however, the change may require adjustments in their revenue models, potentially leading to greater emphasis on advisory services and long-term client relationships.
About the Author
Varun Yadav
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sebi
First Published:
August 10, 2025, 10:08 IST
News business » savings-and-investments SEBI Scraps Transaction Charges To MF Distributors: What It Means For You
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