After Mr.U.K. Sinha took over as SEBI chairman in 2011, February, he constituted a committee to suggest measures to “Revive the Indian Mutual Fund industry“.
The market regulator SEBI accepted this committee's recommendations and introduced a transaction charge of Rs.100 that distributors can charge to investors for every subscription of Rs.10,000 and above.
If any one invest in an mutual fund for the first time, he/she will be charged Rs.150 for every subscription of Rs.10,000 and above and then Rs.100 for subsequent investments.
Same time, since SEBI has given the option to agents to charge or not to charge, there's a good chance that your agent may not collect this fee. Market sources say that many agents who work in metros and big cities such as Mumbai, Delhi and Ahmedabad, Chennai will not collect this fee.
For starters, many such large and established agents feel that this fee is too small. Also, after the entry loads were abolished, many large distributors changed the way they do business and started accepting charges directly from investors, as per SEBI's 2009 August advice.
Internet transaction portals such as www.fundsindia.com & www.fundsupermart.co.in have categorically stated that they will not impose transaction charge. So you need to ask your agent whether or not he will levy transaction charges at the time of investment.
SEBI has clarified that agents will have to follow a uniform practice when dealing with their clients. In simple words, if your agent chooses to levy transaction charge, he will have to collect the same from all his clients. He cannot charge one client, and choose to exempt another.
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