These platforms will make do with the commission received from AMCs
Mumbai: India’s two leading online mutual fund distribution platforms - Fundsupermart and FundsIndia have decided not to charge a transaction fee from its investors. SEBI through its circular issued on Monday said that distributors can either opt in or opt out of transaction charge of Rs 100 and Rs 150.
Chennai based FundsIndia caters to 14,000 investors through its investor platform and 135 IFAs as its sub-brokers under its IFA platform. Mumbai based Fundsupermart has also decided that its platform will not charge its investors, confirms Rajesh Krishnamoorthy, MD, iFAST Financial.
Both FundsIndia and Fundsupermart run separate platforms for direct investors and distributors.
“We have not been charging a fee from our clients since we started our platform in June 2009. Our core value and philosophy is not to charge investors. We cannot change our model overnight because of some regulation unless it is mandatory to do so,” says Chandrashekhar of FundsIndia.
FundsIndia has four in-house advisors who guide clients on their investments. It has tied up with 34 fund houses.
Most fund houses pay a trail commission in the range of 40 to 75 basis points and an upfront commission of 0.25% to 1% on equity schemes. The commission is less on debt funds.
It remains to be seen as to how many distributors opt in or opt out of this transaction charge.
Will you opt in or opt out? Tell us why.
