SEBI cuts fee for brokers, FIIs among others

Mumbai, June 18: In a move that would increase the confidence of brokers, FI...
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Zee News June 19, 2009 Sebi Cuts Fee For Brokers, FIIs Among Others

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Welcoming the decision, SMC Capital equity head Jagannadham Thunuguntla said: "The move is positive and it will encourage wider participation of market intermediaries. This step is market friendly and will help to increase trading volume in the markets."

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Zee News June 19, 2009 Sebi Cuts Fee For Brokers, FIIs Among Others

  1. 1. SEBI cuts fee for brokers, FIIs among others Mumbai, June 18: In a move that would increase the confidence of brokers, FIIs, mutual funds and foreign venture capital funds in the Indian capital market, SEBI on Thursday reduced the fee it charges from market intermediaries by half. The market regulator SEBI has reduced the brokerage charges of all sale and purchase transactions in securities, other than Debt Securities, by 50 per cent from Rs 20 to Rs 10 for a Rs 1 crore turnover. Similarly, brokers' fee for all sale and purchase transactions in debt securities have been reduced to Rs 2.5 from Rs 5 for per Rs one crore turnover. Welcoming the decision, SMC Capital equity head Jagannadham Thunuguntla said: "The move is positive and it will encourage wider participation of market intermediaries. This step is market friendly and will help to increase trading volume in the markets." SEBI has also cut the three-year registration fee of foreign institutional investors (FIIs) to USD 5,000 from the existing USD 10,000. Similarly, filing fee for offer document of mutual fund have been reduced to 0.0020 per cent from 0.005 per cent of the amount raised in the new fund offer, subjected to a minimum of Rs one lakh and a maximum of Rs 50 lakh. Further, the upfront commission to distributors shall be paid by the investor to the distributor directly, the statement said. "But I think it is a good development from the point of view of investors, mutual funds and even the distributors. Now the broker commission would be provided separately from the investment made by the investor," Gupta added. Interestingly, the distributors shall have to disclose the commission, trail or otherwise, received by them for different schemes or MFs which they are distributing or advising the investors. "The distributors' role may be modified into an adviser who provides value added services to investors after this decision. However, in the short term the move may impact the distributors and fund houses," SMC Capital equity head Jagannadham Thunuguntla said. The equity schemes of MFs are likely to be hurt the most as they attract the most entry load among schemes. "It would hurt mostly the equity funds, which are the most rewarding for fund houses, Kumar added.

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