NSE extends waiver of processing fee for MF distributors

The National Stock Exchange (NSE) on Thursday extended waiver of one-time processing fee for mutual fund distributors for using the exchange’s infrastructure for purchase and sale of mutual fund (MF) units.

Besides, to ensure quick registrations of MF distributors, the exchange has allowed payment of deposits, processing fees, annual renewal fees through electronic fund transfer systems like National Electronic Funds Transfer (NEFT) or Real Time Gross Settlement (RTGS).

MF distributors shell out a one-time processing fee of Rs 2,500 in order to use the exchange's infrastructure to purchase and redeem mutual fund units on behalf of their clients. In a circular, NSE announced “... the extension of waiver for one time processing fees of Rs 2,500 ...till September 30, 2015.”

The exchange had first announced the waiver in December last year.

The decision has been taken after receiving feedback from market participants.

In October 2013, the Securities and Exchange Board of India  had allowed MF distributors to use the infrastructure of the exchanges for the purpose.

Prior to that, only stock brokers and clearing members were allowed to transact via stock exchange platform.

The move was aimed at leveraging the stock exchange platform, which would eventually help MF distributors to improve their reach