BSE star platform (brokers) vs buying directly from fund house

I think most if not all brokers register with BSE star MF platform and I believe they get some commission even if its direct mutual funds.
So do we get better rate if we buy directly from fund house where BF star platform or brokers are not involved ?

@Akash_Shah @Jason_Castelino @viswaram @cvs @TradeB2B

Hmm… we haven’t gotten any commission from BSE Star to date.

The expense ratio for direct mutual funds is the same irrespective of where you buy it, on the fund house website or BSE Star.

Most platforms have integrated with BSE because it takes a lot of time and effort to build and maintain connections with all the AMCs in the country (40+). Very hard to do it, especially in a world where the product is offered for free. So for anyone building an MF distribution business, it makes sense to directly integrate with the exchange MF platform (BSE or NSE). For the customer it makes no cost difference, and it is always better to be able to buy funds from all 44 AMCs in one place vs having to buy it and maintain the portfolio separately.


your intention is to buy and then pledge it for trading right?

So its a lot of roundtrip if you go with the AMC first. You might have to get it transferred to a broker for pledging.

If you get a folio number instead of demat, there is a demat conversion fee (Rs150 i think) + days of delay.

Is it not better to get your MFs in your account directly?

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If I am not wrong brokers or any MF distributor have to pay deposit and annual fees to BSE.

So you have no incentive from BSE or Mutual fund house when you give them business i.e. money?

I understand your point and agree to buy through brokers…but was wondering what is broker’s cut in this because they have to pay annual fees to BSE and more man power to run MF operation.

I was trying to figure out what is in this for brokers that we don’t know.
All brokers say go through them and its free …but nothing is actually free.
@nithin is not saint who will do charity. :grinning:

For all platforms today, offering MF is almost like a customer acquisition vehicle. It is a great way to build a sticky audience. Most people who start MF are unlikely to become inactive compared to those who actively trade and can come and go.

So yeah, offering MF for free isn’t like being a saint. :slight_smile:

Ideally, as a business, we should be charging for the effort that goes into it, but since market conditions forced us to offer it for free, we do it. Also, it helps that the active traders generate enough revenue to subsidise investors.