SEBI Slashes MF Expense Ratios: Boosts Investor Returns, Makes Investing Cheaper

• SEBI reduced mutual fund expense ratios by up to 15 basis points, making investments cheaper for retail investors.
• Approved on December 17, the reduction includes a 10 bps cut for higher asset slabs and specific funds like equity and debt.
• Total Expense Ratio (TER) is now Base Expense Ratio (BER), separating core fund operating costs from statutory levies for clarity.
• BER covers fund management fees, distributor commissions, and RTA charges; taxes and other levies are shown separately.
• Experts predict a significant long-term impact, with a 20 bps reduction potentially adding ~₹2.95 lakh to a ₹10 lakh investment over 20 years.

Why It Matters: SEBI's expense ratio cut makes mutual funds cheaper, significantly boosting long-term investor returns.