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SEBI has changed the commission structure for distributors selling mutual funds. Now if any distributor connects a new investor to a mutual fund, he will get additional commission of up to Rs 2,000.
New Delhi. There is good news for mutual fund distributors or agents. Actually, market regulator SEBI has announced the launch of a new structure for mutual fund distributors. Under this, the agent will get additional commission of up to Rs 2000 on every new investor. The purpose of this step of SEBI is to encourage small towns and women to invest more. The new rule will come into effect from February 2026.
According to SEBI, if the agent brings a new investor from a B-30 city (all other cities outside the top 30 cities) or makes a woman investor invest in mutual funds for the first time, then an additional 1 percent commission or a maximum of Rs 2,000 will be given. For lumpsum investment, it will be given on the basis of the first year’s amount, whereas for SIP, 1 percent commission will be given on the total SIP amount of the first 12 months. The special thing is that two bonuses will not be available on one investment i.e. B-30 and Women Investor Incentive will not be applicable simultaneously.
Where will this incentive not be available?
This bonus will not be applicable on certain schemes such as ETFs, Fund of Funds and short-term debt funds (overnight, liquid, ultra-short, low duration). This additional commission will be paid from the 2 basis points that asset management companies (AMCs) already set aside for investor education.
Why was this rule brought?
SEBI says that there were irregularities in the old B-30 incentive. The new model is more transparent and its objective is-
- Increasing the holding of mutual funds in small towns
- Bringing more and more women investors into the market
- Connecting new investors to the market for the first time
Now you get trail commission
Whenever an investor invests money in a mutual fund and for as long as the investment remains in the fund, the distributor receives a small fee every year/month. This is called Trail Commission. Trail Commission Mutual fund companies decide how much will be given on which scheme. Suppose an investor invests Rs 1,00,000 in an equity fund and the trail commission rate is 1%, then the distributor will get ₹ 1,00,000 × 1% = Rs 1,000 every year.
