Now, mutual funds to levy investor 'fees'

This measure, along with capping of the total additional expenses at 0.2 per cent in normal case, are expected to encourage long term holding, reduce churn and align the interests of the fund houses and distributors with that of the investors.

These particular steps would not result in any additional cost to the investors, but the provision for additional expenses of up to 0.3 per cent for inflows from smaller cities could make the investments costlier at the investors' end.

In case of a fund of funds scheme, the total expenses of levied on the scheme would be capped at 2.50 per cent of the daily net assets of the scheme.