Fee-on-advice model for MFs on back burner

Sebi now favours continuing with both fee-based and commission-based model

The Securities and Exchange Board of India (Sebi) is unlikely to proceed with an earlier plan for moving to a fully fee-based model, from the current commission-based structure, for the Rs 17-lakh-crore mutual fund (MF) sector.

According to sources, the regulators now favours continuing with both models till it does a deep analysis of such a transition. This is in contrast to the earlier stand, of wanting the commission-based model to be done away.

The proposal had gathered more steam after the Sumit Bose committee’s recommendations in August 2015, on mis-selling of financial products. The panel recommended phasing out of