SEBI’s clamp-down on MF expenses is great for investors, but mixed news for the industry
After coaxing, cajoling and counselling the Indian mutual fund industry to bring down its costs to investors, the Securities Exchange Board of India (SEBI) finally took matters into its own hands this week. In an action-packed Board meeting, it revisited the cost and commission structure for mutual funds by announcing a new slab structure for scheme expenses, banning upfront commissions, asking AMCs to be more transparent on costs and tweaking the B30 allowance for assets sourced from smaller cities.
While these changes are certainly great for existing fund investors, they may turn out to be a mixed blessing for the growth and development of the fund industry.
