Regular plan

A regular plan is the version of a mutual fund scheme you invest in through a mutual fund distributor — an individual, bank or platform registered with AMFI. The fund house pays the distributor a commission out of the scheme’s expenses, so a regular plan’s expense ratio is higher than that of the direct plan of the same scheme.

Why it matters

You do not pay the distributor separately; the cost is built into the plan’s expense ratio and therefore its NAV. That makes it easy to overlook, but worth understanding, because it compounds over time.

How to read it

• What the commission pays for. Distributors typically help with choosing schemes, completing paperwork and KYC, servicing requests, periodic reviews and staying invested through volatile markets.
• Disclosure. Consolidated account statements show the commission paid to your distributor, and scheme documents publish both plans’ expense ratios.
• Distributor vs adviser. A distributor is paid commission by the fund house; a SEBI-registered investment adviser charges you a fee and has different obligations. It is worth knowing how anyone helping you is registered and paid.

Common misconceptions

• “A regular plan is a different, worse fund.” The portfolio is identical; the cost and the service model differ.
• “There is no cost because I didn’t pay anything.” The cost sits inside the expense ratio and is deducted daily.

In India: Mutual fund distributors must hold an AMFI Registration Number (ARN). Registration details for CompoundX, where applicable, are published on our Disclosures page.