Direct plans are much cheaper, by 0.5 to 1 per cent per annum in equity and 0.05 to 0.5 per cent per annum in debt. These fees were almost half the expenses charged by conventional mutual funds, which remain in the vicinity of 2 to 2.5 per cent in equity and 0.5 to 2.25 per cent in debt. The difference in fees is obviously due to the distributor or broker being disintermediated by direct schemes.
