Commission disclosure will help increase transparency: U K Sinha

Modi ke acche din aane wale hain. Sebi wants distributors to play ganda. We will do that...ab sebi ko dikha denge, rozi roti bachane ke liye ik insaan kitna bhi ganda kar sakta hai aur sah sakta hai. If sebi wants commission sharing to become a norm rather than investor awareness and creating investor wealth, then be it. Let the bad games begin. ...

It will definitely bring disturbance in mutual fund business and clients will be confused.it will create a sin like 2009 to 2013 when upfront brokerage were been not paid.

Thanks Mr SINHA for thinking such a innovative step of ` COMMISION DISCLOSURE` scheme. But at the same time he have to think where he is going to implement such a step...as because Indian mutual industry has just started crawling in Investment industry.....& we the distributors are trying our label best to grow this MF industry....If such a step taken it will create a great confusion among the investors..

Transparency can also be created by running around without clothes. Is that a good thing? The regulator wants distribution of Mutual funds to end. It has already become an unviable business and will end soon.

I think SEBI is under a very wrong impression that the "patient can themselves become doctor". Specially in India where less than 1% of population is invested in mutual funds, non promotion of Independent Financial Advsiors will further lead to bad figures.

No body is India has ever remain invested for 15 - 20 yrs on its own in mutual funds (not a larger chunk). A single dip in markets stops nearly half the investments.

Secondly are AMCs capable to cater the clients DIRECTLY? Do they enough infrastructure / man power / resources etc. I will not name a AMC, but that AMC is roughly 40000 crores & they have only 1 office at rajasthan with only 1 person in sales & 1 person in operations at Jaipur City (which is the capital of Rajasthan).

I would further add that the disclaimer written at the end should be changed to

"MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET VOLATILITY IN SHORTER TERMS. REMAIN INVESTED FOR LONGER TERM. CONSULT YOUR ADVISOR."

Dear Mr.Sinha,
All the fingers are not same. all countries are not same. all the public are not same.
then why you are copying rules and regulation from other countries ? like US & Canada.. It's our country think about yourself think about indian market indian investor psychology. You are killing MF Industry and IFAs Family.

I wanted to humble request to SEBI chief, kindly, promote every thing direct, as we Indian can do everything direct/self- We can drive- No need of drivers, drive direct, We can do cleaning/JHARU PAUCHA- Do direct no need of domestic Servant- All disease's medicines are available on Google - Go direct -no need to visit doctors,
No need keep peon in office, as one can manage his/her need directly.
Please, somebody should give the wisdom to SEBI chief.
Pls - promote everything direct.
I think we don't need to defence/Army also, we should defend are self directly.

Respected Bosses of SEBI must not be acting on their own whims-- There must be some policy guidelines from Central Govt.. Do the Govt. plans to disclose income of all middlemen? Middlemen means all brokers+ commission agents + distributors- stockists--- rendering services across all industries+trade+service sectors--Only manufacturers are , not middlemen in real terms--
If only MF industry is forced to disclose, it may be a constitutional diversion in "Equality concept" --
Can petitions be lodged at courts as Only MF industry is being punished ?--

Great Step !!! But a greater step would be to disclose each and every salary/fees received by every person related to mutual fund. Why only Distributors? Just because we go on tolerating everything it doesnt mean undue advantage will be taken. How do you propose to sell direct plans? Will U K Sinha come personally and advise clients? You people are changing norms just for the sake of changing. In recent times we saw a growth in mutual fund investments. Do you think that was because of you? No, it was because distributors like us created awareness. Anyways, its just like banging your head against the wall.

WHY IT IS APPLICABLE FOR MUTUAL FUND ADVISERS ? IT SHOULD BE APPLICABLE WITH INSURANCE ( LIFE & NON LIFE ) , BANK ALSO .

Mr Sinha current steps to promote the business through direct mode is influenced by AMC presser . We should avoid such AMC business who are ready to use our data and ruin the distributors business.

But the same is already disclosed in way of Direct Plans. Then why such separate difference required. Its like we are already disclosing that 1-2. Then why SEBI says transparency will be in 1-2=1

It is very bad situation in India the regulator makes regulations by taking opinion from few officials of AMC who are having vested interest and show their performance becoz they take hefty salary and other perks.If a distributors earns for their lively hood a small portion of money after paying service tax,income tax, now introducing sharing of our money to the investors. It indicates the few powerful persons are influencing Sebi Chairman to bring regulations according to their wishes. I request the those guys and SEBI Chairman instead playing around with the distributors just say no commission will be paid to distributors and IAs like Arab countries. Need not discuss on this issue just pass a regulation that commission will not be passed on to distributors in India finish.

Perhaps sebi chairman Mr.U K Sinha has been take a resolution to destroy the family of IFA & mutual fund industry in india.

Why don't u ask LIC to show commision disclosure first.why u wanted to destroy mf genuine business..Indian people dnt have maturity same as.us uk clients/investors.disclosure will ask more cash back from clients n we ll not able to do same..one foolish step will surely destroy history of industry

Ohhh......No Boss.... no! do not do this, we observe very big gap in the alignment of implementation of government polices and its goal of the regulatory authority. It is 11 years now, our government fully engaged their machinery towards framing the policy for Financial inclusion, banks were urged to review their existing practices to align them with the objective of financial inclusion, resulted RBI to allow the intermediaries in Banking channels and permitted banks to recruit intermediaries to provide banking services, which is now becoming big and costly task for the bank to recruit and organize the channel.

Why SEBI is moving in other direction? Why they are in understanding no one to oppose their decision?Unlike the bank they have got established channel of approx one lakh free and knowledgeable workforce along with penetration in almost each district of the country as IFA that could be utilized for the financial inclusion purposes . Why they are getting differed then the strategy of RBI?
I find only two reason, (1) The first reason i find is that they are getting lobbied by the few AMC itself who has created big clientele database by the help of IFA and now they think they can divert them to direct without affecting their AUM. They are seems to be only responsible for washing the mind of SEBI and framing the policy in their favor.
(2) Our IFA association is ineffective, the persons represented the SEBI in behalf of IFA probably lacked their homework and could not be able to present the over all impact analysis due to this disclosure.
We should continue our fight..........!

Commission reduction over a period of time would have found favor from both IFA's and benefit clients as well. However, commission disclosure will make IFA business a non starter.
I'm regretting why I started into this business with a mind to educate investors and build SIP book and also earn decent money.
Now all I will land up will be doing commission sharing calculations, client retention not because I provided them bad research and advise but because some other person is giving them higher passback in commission.
Once we give passback, the client value in our eyes drop, then we also will be forced to provide them products and funds which have higher commissions etc , not take care of clients in falling markets, not goading them for the long term but keep on changing their funds profile, all these kind of activities will start.
In India, people do not value advise. They get that for free everywhere and SEBI is asking us to charge for that. Only the very wealthy value research and advise. Everything has now become a DIY project and mutual funds will be in that category too.
Only when in times of falling markets or wrong fund selection, then the clients will realise the value we bring to the table.
Till then, keep your powder dry, try to retain clients at all costs.

And yes, what our associations are doing I don't know. We should have challenged this kind of rules in court. But they are busy in conferences and lunches rather than protection of business first.

MY SINCERE ADVISE TO YOUNG GENERATION - LOOK FOR OTHER BUSINESS. MUTUALS FUNDS REGULATOR DOES NOT WANT YOU NOW. HE WANTS FREE PEOPLE TO WORK FOR THEM - RETIRED PERSONS, SCHOOL TEACHERS ETC WHO DO NOT HAVE A CAREER IN FRONT OF THEM.

Dear Mr. Sinha, The leader should be a role model to the follower, i request you to kindly disclose your
CTC to the public now...

It should be like that if we purchase a bread, butter, petrol, wheat flour, pulses, milk the profit margin from manufacturer/importer to retailer should be clearly printed on the bill, but it will not implemented by any govt body....disclosure of commission is simply the worst ever step taken by any govt body which target IFA fraternity only and will harm more to investors than advisors. In simple words this decision is a big nonsense????????????????????????????

Mr. Sinha tumhare irade kya hai kya distributer nahi chahte ho industri me. Hame lagta hai hai mf ko bhi satta bazar banana chahte ho. Aur clint ka invetment khana chahte ho.

Mr. Sinha transparency does not mines that Commission disclosure of distributor.......If mutual fund does not disclose Expense Ratio properly .......If AMFI or SEBI sit with me I can prove that thay manipulate there expense ratio in the fund- BAIDYANATH DAS

There is a silver lining to all this commission disclosure thing.

First reduced competition as many marginal advisors will leave business and more than that very few new advisors joining the industry.

When a young graduate or post graduate MBA etc can get minimum Rs 4 lacs starting package in banks and other big companies then why he/she will join mutual fund distribution or RIA business

1) No certainty of client business
2) Business takes time to build up - almost 3-4 years of out of pocket expenses. I'm new to this business and I for sure know how I'm just paying expenses and surviving. If I start focusing on insurance then maybe I can get enough clients upfront to pay for living expenses. So people are joining insurance industry because of good commissions, good policies and above all a favorable regulator.
3) Fear of direct plan will keep those people away who take up advisory on basis of few big clients or relatives.
4) If young advisors fail in MF distribution or RIA, then will be even more harder for them to find lucrative jobs.
5) People mindset is not to pay for advice which they get free from every source - news, online, papers etc. Till the time people understand value of advise, they are already over 45, a large part of their wealth building lives get over. So RIA model is doomed and only distribution is successful for financial literacy and wealth creation for both client and advisor. SEBI is thinking of Mumbai to be entire India and India to be like Canada / UK / US, which is not true.

Moreover, clients who are with banks and getting mf sold by tellers and clerks will come to us when they start valuing proper financial advise.

We just need to pass the turbulent times and hold on to clients like family.

I am happy and welcome these changes as a "FEE ONLY" Financial Planner. Nothing to say more as all the changes going my way.

parting gift . uti unable to build for a decade for the disturbance left. now restored due to hard working of the successor. now ifa'S are left in lurch. great persons comes once in a decade to destroy certain institutions for a time and difficult for the successors to fill the vac cum. saner advises are not palatable. transparency in accounting, redemption, improving the reporting system, banking problems will elevate . not the disclosure to the society the amounts due to IFA hard earnings. it behooves the character of the regulator. magnanimity comes in elevation of oneself by servicing the all round prosperity of the society. even scriptures does not indicate transparency unless needed and known by the well-read. half baked and self intent persons fails to get public good wishes. the regulators should be above parochial considerations and should not indulge and hit below the belt of the persons earnings and earn wrath of the vast community who thrive day and night in bringing semblance rather than with micro thinking's than mitigating the working conditions with a human face-sadbhavana

parting gift . uti unable to build for a decade for the disturbance left. now restored due to hard working of the successor. now ifa'S are left in lurch. great persons comes once in a decade to destroy certain institutions for a time and difficult for the successors to fill the vac cum. saner advises are not palatable. transparency in accounting, redemption, improving the reporting system, banking problems will elevate . not the disclosure to the society the amounts due to IFA hard earnings. it behooves the character of the regulator. magnanimity comes in elevation of oneself by servicing the all round prosperity of the society. even scriptures does not indicate transparency unless needed and known by the well-read. half baked and self intent persons fails to get public good wishes. the regulators should be above parochial considerations and should not indulge and hit below the belt of the persons earnings and earn wrath of the vast community who thrive day and night in bringing semblance rather than with micro thinking's than mitigating the working conditions with a human face-sadbhavana