Mutual Funds
Direct vs Regular Mutual Fund - Which is Better?
Why direct plans give 1% higher returns, how to switch from regular to direct, and when regular makes sense.
5 min read
IPO
IPOFins Team
Finance Research & Data • June 2026
Direct vs Regular Mutual Fund
Direct plan is always better for returns.
Difference
- Direct: No distributor commission. Lower expense ratio.
- Regular: Distributor earns 0.5-1% annually from your investment.
Impact Over 20 Years
₹10,000/month SIP: Direct (12%) = ₹98.9L vs Regular (11%) = ₹86.4L. Difference: ₹12.5 lakhs lost to commission!
Where to Buy Direct
- Groww, Zerodha Coin, Kuvera (free platforms)
- AMC websites directly
How to Switch
Stop regular SIP. Start new SIP in same fund's direct plan. Let old units grow (don't redeem — triggers tax).