Upfront commision to distributer from MF

Hi All,

I had gone thro’ the following information.

“The commission structures for selling equity mutual fund (MF) schemes are back on the high levels as those witnessed during the pre-entry load ban regime. With the equity markets buoyant, mutual fund houses are now offering more commissions to their distributors in order to survive in the market.

For instance, for a three-year monthly SIP of 10,000, upfront commission of 8,000 is given, which is equivalent to 2.25% of total investment. For five-year SIPs, it goes up to 22,000 or 3.75% of investment committed.”

Why do the MF are giving so much of commission to distributers. I have started investing in MF by own and not using any of distributer channels but i still in loss even after Entry load is removed. What’s your views?

Regards

Irshad