Our Business Model
How FinEdge Makes Money — and What Investors Get for It
FinEdge earns distribution commission through the Regular Plans of Mutual Funds and SIFs that it distributes.
The commission forms part of the regulated expense structure of the Regular Plan. Direct Plans cost less because the distribution expense and commission are removed.
We do not dispute that arithmetic.
What we dispute is the idea that the cheapest way to buy an investment is automatically the best way to invest.
If all FinEdge did was help you access the same investment you could buy yourself, the higher cost would be hard to justify.
Our model has to earn that cost through what happens around the investment: structure, judgement, challenge, behaviour, review and continuity.
How does FinEdge make money?
FinEdge is an AMFI-registered Mutual Fund & SIF Distributor. It earns distribution/trail commission on investments made through the Regular Plans it distributes. The exact commission varies by scheme or SIF strategy and is disclosed separately. Direct Plans have a lower expense ratio because distribution commission is excluded.
Direct is cheaper. That does not make it an investing strategy.
A Direct Plan removes distributor commission from the expense structure.
That is a real cost advantage.
But Direct tells you how the mutual fund or SIF is purchased. It does not tell you:
- what the money is for;
- how much you need to invest;
- what risk the goal actually requires;
- what role the investment should play inside the portfolio;
- whether you already own something that does the same job;
- whether a new investment is needed at all;
- when a portfolio genuinely needs to change;
- how to behave when markets become uncomfortable;
- or how today's decision should remain connected to decisions made years earlier.
What Direct solves
Direct solves lower product cost
A Direct Plan removes distributor commission from the expense structure. That is a real cost advantage.
What investing still requires
- Purpose
- Portfolio
- Risk
- Judgement
- Behaviour
- Review
- Continuity
None of these are decided by the plan you buy.
No middleman is a description of the distribution chain. It is not a description of the quality of the investing process.
Are Direct Plans cheaper than Regular Plans?
Yes. Direct Mutual Fund and SIF Plans exclude distributor commission and therefore have a lower expense ratio than the corresponding Regular Plan. The question FinEdge asks is not whether the cost difference exists. It is whether the decision system around a Regular Plan adds enough value to earn that difference.
Lower-cost access and investment advice are different decisions
AMFI's own investor guidance makes the distinction clear: Direct Plans are for investors who can select and manage funds themselves or investors who are willing to obtain professional advice separately.
The market is showing the same thing in practice.
In July 2026, Groww — long associated with zero-commission Direct Mutual Funds — introduced an optional guided mutual-fund service after customers asked for help with what to buy, hold, exit and rebalance. Investments under that service use Regular Plans.
In the same month, Zerodha said it is working on an advisory offering while continuing to use Direct Mutual Funds.
Different compensation routes. Same underlying point:
Direct versus Regular is a plan-and-cost decision. Advice versus no advice is a different decision.
Investors have more information and easier execution than ever. The hard part has not disappeared.
An investor can now access:
- Direct Plans
- fund rankings
- screeners
- market commentary
- social media
- instant transactions
- AI-generated answers
The information problem has become smaller.
The decision problem has not.
In our portfolio reviews, we repeatedly encounter self-directed portfolios that have become difficult to explain as one coherent system: too many funds, overlapping exposures, recent-return-led choices, NFOs, repeated switching and speculative activity sitting alongside long-term goals.
The issue is not that a Direct Plan caused those decisions.
The issue is that lower-cost access does not create portfolio structure, conviction or decision continuity on its own.
SEBI's own data on high-activity investing is a useful warning about access without disciplined decision-making:
SEBI studies — individual trading outcomes
- 93% of individual equity F&O traders incurred losses during FY22–FY24; aggregate losses exceeded ₹1.8 lakh crore.
- 7 out of 10 individual intraday equity-cash traders made losses.
Those figures are about trading, not mutual-fund Direct Plans.
Their relevance is simpler:
Making financial activity easier does not automatically make financial decisions better.
"Zero commission" is a price. It is not the whole business model.
Groww's current mutual-fund page says:
Zero commissions
No middlemen, no extra fees.
That tells the investor what Groww charges for Direct Mutual Funds.
It does not describe the economics of the whole company.
Groww's own IPO disclosures show that Broking Services — stocks and derivatives — generated 84.50% of revenue from operations in FY25 and 79.49% in the three months ended 30 June 2025. Its wider platform also offers intraday trading, MTF, derivatives and credit products.
Zerodha's Coin similarly offers 0% commission Direct Mutual Funds. Zerodha's founder has also written publicly that almost every brokerage business model relies on earnings from active options traders.
These are the companies' own statements and disclosures.
The point is not that a broader financial-services business is inherently wrong.
The point is that:
Zero mutual-fund commission does not mean zero commercial interest. It means the mutual-fund commission is zero. The wider business still has economics.
Headline product price
Zero mutual fund commission
Whole business economics
What does the wider business monetise?
- Mutual fund commission
- Broking
- Trading
- Margin funding
- Lending
- Subscriptions
- Product manufacturing
These are possible monetisation categories across the industry. Not every platform uses every category.
Does zero commission mean an investment platform has no commercial interests?
No. A platform can charge zero commission on Direct Mutual Funds and earn elsewhere through broking, derivatives, margin funding, lending, subscriptions, manufactured products or other financial services. Investors should examine the complete business model, not only the headline price of one product.
Starting investing is easy. Staying invested well is not.
The difficult decisions arrive later.
Start
A SIP can be started in minutes.
The continuing years
- when another fund has just performed better;
- when markets fall and the original plan suddenly feels wrong;
- when markets rise and taking more risk starts feeling easy;
- when an NFO or new theme looks exciting;
- when a goal, income or family priority changes;
- when one part of a diversified portfolio underperforms;
- when the investor wants to stop, switch or add simply because something happened in the market.
Compounding may be mathematical.
Staying in a suitable investing process long enough to benefit from compounding is behavioural.
That is why FinEdge does not believe execution is the whole investing job.
"As an investor, the question should not be if I can get it cheaper, but what value is being added for a higher expense ratio. Starting investing is easy; staying invested is not."
Co-founder & CEO, FinEdge
What FinEdge must add to earn the higher cost
A higher-cost model does not deserve to exist merely because someone calls the service "advice".
FinEdge has to create meaningful value around the investment.
- Structure
Connect goals, cash flows, existing investments, time horizons and priorities into one coherent investing structure.
- Judgement
Decide what is relevant for this investor rather than treat a fund, return number or market view in isolation.
- Challenge
Question the requested action when it may not solve the real problem — including when the better decision is to continue, wait or make no new investment.
- Behaviour
Help the investor distinguish a real change in circumstances from fear, excitement, comparison and market noise.
- Review
Ask whether to Continue, Adapt or Act based on goals, portfolio role and changed context — not create activity for the sake of activity.
- Continuity
Preserve why important decisions were made so that the next review does not begin from zero.
Supported by one operating system
Investment Manager + Process + Technology + AI
You are not paying FinEdge for access to a mutual fund or SIF. You are paying for the decision system around the investment.
If Direct is cheaper, why pay FinEdge?
Because the additional cost is not for access to the same investment. FinEdge's model is built to provide a continuing decision system around it: goal-linked structure, Investment Manager judgement, challenge, portfolio review, behavioural support, technology, AI-enabled context and relationship continuity. The investor should judge whether that system creates enough value to earn the additional cost.
Who needs more than execution?
The need for guidance is not a measure of intelligence or financial sophistication.
The question is whether the investor wants a continuing system that can:
- connect investments to real financial goals;
- evaluate the complete portfolio rather than isolated products;
- decide what level of risk is actually required;
- challenge return chasing or unnecessary change;
- preserve the reasoning behind previous decisions;
- review whether circumstances have genuinely changed;
- support behaviour through difficult markets;
- and keep the investing journey coherent over years.
In FinEdge's experience, sophisticated investors often value professional judgement precisely because important financial decisions benefit from challenge, context, delegation and continuity.
The value of advice should therefore be judged by the quality of the decisions it helps create — not by whether the investor was technically capable of clicking Buy without it.
Apply the same commercial-model test to FinEdge
FinEdge has commercial interests.
We make them visible.
FinEdge earns trail/distribution commission on assets invested through the Regular Mutual Fund and SIF Plans it distributes. The commission rate can vary by scheme, strategy and AMC.
FinEdge does not build its economics around the number of trades an investor places.
Our model is intended to become commercially stronger through durable investing relationships and assets that remain appropriately invested over time.
- Regular MF / SIF assets
- Trail / distribution revenue
- Continuing relationship economics
That operating model is supported by several deliberate choices:
0 Sales Targets at FinEdge
Investment Managers do not carry sales, revenue or product targets.
People before Products
The investor's goals, suitability and situation come before the product decision.
No activity requirement
A successful FinEdge conversation does not have to end with a new investment. The right conclusion can be continue, wait, restructure, address another financial priority or take no new product action.
Continuing review
The relationship is designed around decisions and reviews over time rather than requiring repeated transactions to demonstrate value.
The question is not whether a financial business has commercial interests. The question is what behaviour its economics reward — and what the institution has built around those incentives.
What behaviour does FinEdge's business model reward?
FinEdge's distribution revenue is linked primarily to assets invested through the Regular Mutual Fund and SIF Plans it distributes, not to transaction frequency. The model is therefore built around continuing relationships, appropriate investing, review and long-term decision support. Commission rates can differ, which is why FinEdge combines transparent disclosure with zero sales targets, goal-and-suitability-first process and governed recommendation frameworks.
See exactly what FinEdge earns
A conviction-led business model should still be measurable and transparent.
FinEdge publishes its commission disclosures so investors can examine the economics themselves rather than rely on a generic percentage illustration.
The standard we hold the model to
Direct Plans are cheaper.
FinEdge should never need to hide that fact.
But lower cost is only one part of an investing outcome.
Our standard is harder:
Does the system around the investment help the investor make better-informed, more coherent and more sustainable decisions often enough to justify what it costs?
FinEdge believes the answer is yes.
Not because a Regular Plan is automatically better.
Because we have deliberately built the business around the work that product access alone does not perform.
If we cannot keep earning that difference through meaningful investor value, the right response would not be better wordplay.
It would be to question the model itself.
Judge the model by what it adds to your investing
Understand the work FinEdge actually performs, examine the commissions we earn and then decide whether the model is valuable for the way you want to invest.