What a regular plan pays your distributor, from AMFI's own file
Every mutual fund in India comes in a regular plan and a direct plan, and AMFI publishes the expense ratio of both, every day. We read October's file for 1,780 schemes. On ₹1 crore in an actively managed equity fund, the median gap is ₹1.18 lakh a year.
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A mutual fund scheme runs one portfolio but sells it in two plans. The regular plan is what you buy through a distributor: a bank's wealth desk, a national distribution firm or an individual agent. Each of them holds an ARN, a registration number from AMFI. The direct plan is bought straight from the fund house, with no distributor. Both plans own the same shares and bonds. The difference is the expense ratio, and the difference in expense ratio is what the regular plan pays for distribution.
AMFI publishes both expense ratios for every scheme on its TER page. We downloaded the October 2026 file and took the latest total expense ratio for each scheme. 1,780 schemes list both plans.
The gap, by kind of fund
| Kind of fund | Schemes | Regular plan, median | Direct plan, median | Gap, median |
|---|---|---|---|---|
| Actively managed equity | 618 | 2.27% | 1.09% | 1.18 points |
| Hybrid | 128 | 2.17% | 0.97% | 1.18 points |
| Arbitrage | 39 | 2.07% | 1.42% | 0.68 points |
| Debt (excluding liquid and money market) | 261 | 0.85% | 0.36% | 0.47 points |
| Index funds | 373 | 1.03% | 0.40% | 0.48 points |
| Fund of funds | 208 | 0.64% | 0.20% | 0.43 points |
| Liquid, overnight and money market | 109 | 0.25% | 0.13% | 0.11 points |
Figures are yearly, as a share of the fund's daily net assets, and include GST and trading costs. We grouped AMFI's own category names into these kinds. Each median is worked out separately, so the gap is not always the regular median minus the direct median.
Eight well-known funds
These eight have gaps between 0.49 and 0.92 points, all below the equity median. Figures are the latest in AMFI's file as downloaded on 17 October 2026.
| Fund | Regular | Direct | Gap |
|---|---|---|---|
| HDFC Flexi Cap Fund | 1.36% | 0.75% | 0.61 points |
| HDFC Mid Cap Fund | 1.31% | 0.74% | 0.57 points |
| HDFC Balanced Advantage Fund | 1.30% | 0.77% | 0.53 points |
| ICICI Prudential Large Cap Fund | 1.50% | 1.01% | 0.49 points |
| SBI Large Cap Fund | 1.51% | 0.89% | 0.62 points |
| Nippon India Small Cap Fund | 1.39% | 0.68% | 0.71 points |
| Axis Large Cap Fund | 1.76% | 0.92% | 0.84 points |
| Mirae Asset Large Cap Fund | 1.68% | 0.76% | 0.92 points |
What the gap comes to at your size
The expense ratio is never sent to you as a bill. It is taken out of the fund's assets every day, so the NAV you see is already net of it.
| Held in regular plans | Gap of 0.62 points | Gap of 1.18 points |
|---|---|---|
| ₹50 lakh | ₹31,000 a year | ₹59,000 a year |
| ₹1 crore | ₹62,000 a year | ₹1.18 lakh a year |
| ₹5 crore | ₹3.1 lakh a year | ₹5.9 lakh a year |
These are first-year figures. Because the cost comes out every year, it compounds. Take ₹1 crore held for 15 years. If the direct plan earns 12% a year (an assumed figure, for illustration), it grows to ₹5.47 crore. A regular plan with a 1.18 point higher cost earns 10.82% and grows to ₹4.67 crore, ₹80 lakh less. With a 0.62 point gap, the shortfall is ₹44 lakh.
What the commission pays for varies. A distributor may handle paperwork, rebalancing, nominations and transmission when someone dies, or very little. The file tells you the price, not the service.
How to see which plan you hold
Request a detailed consolidated account statement (CAS) from CAMS or KFintech. Under each scheme it prints the code of whoever the units were bought through:
- ARN- followed by a number: a mutual fund distributor, paid through the regular plan
- INA followed by a number: a SEBI-registered investment adviser
- DIRECT: no one, bought straight from the fund house
Direct plans also carry "Direct" in the scheme name on the CAS.
Moving from regular to direct is a sale
The two plans are separate for tax purposes. Moving from one to the other is a redemption of the regular plan and a fresh purchase of the direct plan, so it can create capital gains tax, and an exit load if the units are recent. Say ₹1 crore of an equity fund held for more than a year carries ₹40 lakh of gains. Long-term gains above ₹1.25 lakh a year are taxed at 12.5%, so the sale would cost about ₹4.84 lakh before surcharge and cess. That tax is a one-time cost. The expense ratio gap recurs every year. How the two compare depends on how long you will hold the money and how large your gains are.
Questions
- What is the difference between a regular and a direct mutual fund plan?
- Both hold the same portfolio. A regular plan is bought through a distributor and has a higher expense ratio that pays for distribution; a direct plan is bought from the fund house with no distributor.
- How much more does a regular plan cost?
- In AMFI's October 2026 file, the median gap for actively managed equity funds is 1.18 percentage points a year: 2.27% for the regular plan against 1.09% for the direct plan.
- How much is that on ₹1 crore?
- About ₹1.18 lakh in the first year at the median equity gap, taken out of the NAV rather than billed.
- How do I know if I hold a regular plan?
- Your CAS prints an ARN code against regular plan holdings bought through a distributor, INA for a registered adviser, and DIRECT for direct plans. Direct plans also carry "Direct" in the scheme name.
- Is moving from regular to direct taxed?
- Yes. It counts as selling the regular plan and buying the direct plan, so capital gains tax and any exit load apply.
Sources
- AMFI, Total Expense Ratio of mutual fund schemes, October 2026 file (downloaded 17 October 2026)
- CAMS, Consolidated Account Statement request
Compound is analysis, not investment advice. Reva Money is not a SEBI-registered investment adviser.
