Mutual fund distributors earned Rs.12071 crores in mutual funds commission in FY22-23

Like every year, AMFI (Association of Mutual Funds in India) released a yearly report on commissions earned by mutual fund distributors. In FY 2022-23, The commissions earned by the distributors soared nearly 16% YoY to over Rs.12,071 crores.

You can either use the regular plan or the Direct plan when investing in mutual funds. When investing in a regular plan, you have to pay commissions, which can be as high as 1% yearly on the invested amount, as long as you’re invested.

If you’re investing in a direct plan, you pay no such commissions; on Coin, we offer zero commission direct mutual funds.

For example, Over the past 5 years, SBI Bluechip fund would have given you 79% returns if you would have taken the regular plan, Whereas, the direct plan would have fetched you 86% returns.

As the corpus compounds, The 7% difference would start hurting as compounding works both ways i.e., even for commissions.

You can check this post by @Bhuvan , Where he explained in detail on how these extra commissions hurt investors in the long run as corpus grows

Commission earned by Mutual Fund distributors in FY 22- 23

Here’s a list of the top 20 mutual fund distributors and the commissions they earned:

Name of the ARN Holder Commission recd (Cr)
NJ IndiaInvest Pvt Ltd 1,538.98
State Bank of India 905.46
HDFC Bank Limited 669.27
Prudent Corporate Advisory Services Ltd 583.04
Axis Bank Limited 542.25
ICICI Securities Limited 453.63
ICICI Bank Limited 397.82
Kotak Mahindra Bank Limited 297.28
Anand Rathi Wealth Limited 212.79
Hongkong & Shanghai Banking Corporation Ltd. 135.49
IIFL Wealth Prime Limited 123.64
Standard Chartered Bank 120.95
Citibank N.A 117.62
Julius Baer Wealth Advisors (India) Private Limited 111.10
Bajaj Capital Ltd. 102.40
Bank Of Baroda 99.82
HDFC Securities Ltd 96.69
Geojit Financial Services Ltd 81.72
Wealth India Financial Services Pvt Ltd 75.80
Sapient Wealth Advisors And Brokers Pvt Ltd 74.33

Fun fact

Top 20 distributors earn 56% of the entire mutual fund industry’s commission while Top 50 distributors make more than 65% of the industry’s commission.

As you can see, the commission income for the distributors especially the top ones is skyrocketing :

If you are new to investing in Mutual funds and all of this seems gibberish, Don’t worry, You can check out the following Varsity’s chapter on Mutual funds:

You can also share your queries and thoughts on this thread.