Top MF distributors see 31% fall in commissions in FY16

MUMBAI: Mutual fund gross commissions of the top 10 distributors for 2015-16 declined 31% to Rs 1,651 crore compared to Rs 2,399 crore in the previous year, according to AMFI data. This decline was despite average assets under management for the same set of players moving up from Rs 1,91,318 crore to Rs 2,27,119 in 2015-16, an increase of 18.71%.

NJ India Invest was the only distributor among the top 10 in the country whose commission increased to Rs 326 crore — a 8% rise over the previous year. The decline in commissions is due to the absence of close end schemes in 2015-16 and a 1% cap on upfront commissions since April 2015 by the regulator.



“Commissions look low this year, as upfront commissions were paid on close end schemes in the previous year and the 1% cap on upfront commissions came into play in this financial year,” says Manoj Nagpal, MD, Outlook Asia Capital. Since a number of three-year close-ended equity mutual fund schemes were launched in 2014-15,where upfront commission were as high as 6%, the commissions for 2014-15 look high, said distributors.