Mumbai, Dec. 31: The Securities and Exchange Board of India (Sebi) has scrapped the entry load on mutual fund investors who apply directly to asset management companies (AMCs) with effect from January 4, 2008.

“It has now been decided that no entry load shall be charged for direct applications received by the AMCs, i.e applications received through the Internet, submitted to AMCs or collection centre/investor service centres that are not routed through any distributor/agent/broker,” Sebi said in a circular here.

To facilitate the growth of the mutual fund industry, the regulator said in a circular that investors who did not route their investments through any distributor or agent would not have to pay any entry load for investing, or additional purchases under the same scheme in mutual funds.

Investors switching from one scheme to another while dealing directly with the AMC will also be exempted from paying any load.

Sebi said the growth of the mutual fund industry in the past years and the technology available for investments had enabled investors to take informed decisions and to buy units through the Internet and other modes without availing themselves of services of distributors or agents or brokers.

The move follows a proposal made by Sebi a few months back to waive entry loads on direct investors in mutual funds.

The move, however, would have adverse implications for the intermediaries who have been involved with the mutual fund industry.