SEBI Slashes Mutual Fund Expense Ratios, Boosts Transparency for Investors

• SEBI has revised mutual fund expense norms, excluding statutory levies from expense ratio calculations.
• Statutory charges like STT, CTT, GST, stamp duty, and SEBI/exchange fees will now be charged separately on actuals.
• This change aims to reduce headline expense ratios and bring greater transparency to fund costs for investors.
• The Total Expense Ratio (TER) will now comprise base expense ratio, brokerage, and regulatory/statutory levies.
• Base expense ratio for ETFs revised from 1% (inclusive) to 0.9% (exclusive of levies), aligning with global practices.

Why It Matters: SEBI's new norms reduce mutual fund expense ratios and enhance transparency for investors.