Mutual funds cannot charge entry fee from August
By IANSWednesday, July 1, 2009
MUMBAI - Mutual funds have been barred from charging an entry fee on investments from Aug 1, India’s market regulator said in a late evening announcement Tuesday.
Mutual funds can, however, levy a “a maximum of 1 percent of the redemption proceeds” when an investor exits from the scheme, the Securities and Exchange Board of India (SEBI) said.
Investors henceforth will have to pay an upfront charge directly to distributors based on their services.
The distributors have also been directed to disclose “all the commissions payable to them” by the funds.
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