1. Direct vs Regular: The Fundamentals
Every mutual fund scheme in India exists in two versions: Regular Plan and Direct Plan. They hold the exact same portfolio of stocks, are managed by the exact same fund manager, and follow identical investment mandates.
The sole difference lies in how they are bought. When you buy a regular plan through a distributor, bank relationship manager, or legacy broker, the fund house deducts a recurring trail commission (typically 0.5% to 1.2% per year) and pays it to the intermediary.
2. The 15-Year Commission Leakage
A 0.75% difference sounds like loose change. But because mutual fund expense ratios are deducted from your total fund assets every single day, the compounding drag over 15 to 20 years is staggering.
On a ₹10,000 monthly SIP compounding at 12% over 20 years, a direct plan delivers approximately ₹99.9 lakh. The regular plan delivers around ₹87.2 lakh. That 0.75% difference quietly diverted over ₹12.7 lakh into distributor fees.
3. Why Seedvest is 100% Direct
Seedvest operates under SEBI's Execution-Only Platform (EOP) framework. We never accept distributor commissions from AMCs. Every rupee you deploy goes directly into purchasing fund units in your name.