Direct plans are mutual fund units you buy directly from the fund house (or through platforms that don’t charge distribution fees). Regular plans are sold through distributors, agents, or platforms that earn a commission—which is built into a higher expense ratio.
Key Difference
| Factor | Direct Plan | Regular Plan |
|---|---|---|
| Expense ratio | Lower (e.g. 0.1–0.2%) | Higher (e.g. 0.5–1%) |
| Distribution | No commission | Commission to distributor |
| Where to buy | AMC website, Zerodha, Groww, etc. | Banks, agents, some platforms |
For FIRE Investors
Direct plans save 0.5–1% or more per year. Over 20–30 years, that compounds to a significant difference in your retirement corpus. There is no performance advantage to regular plans—only higher costs. FIRE investors should prefer direct plans for index funds and other long-term holdings.