SEBI Slashes MF Expense Ratios: Cheaper Investing, Bigger Returns for Investors!

• SEBI has reduced mutual fund base expense ratios (BER) by up to 15 basis points, aiming for cheaper and more transparent investing.
• New rules, effective December 17, 2025, lower maximum charges for open-ended equity funds, debt funds, index funds, ETFs, and FoFs.
• The Total Expense Ratio (TER) is now the Base Expense Ratio (BER), separating core fund expenses from statutory levies like GST and STT for clarity.
• BER includes fund management fees, distributor commissions, and RTA charges, while statutory costs are shown separately.
• Even small reductions (10-20 bps) significantly boost long-term wealth due to compounding; a 20 bps cut on Rs 10 lakh over 20 years can add ~Rs 2.95 lakh.

Why It Matters: SEBI's lower MF expense ratios mean more money stays invested, significantly boosting long-term wealth.