With the number of people investing in the stock market is sky-rocketing; many brokerage platforms are coming forward with a variety of features. If you are looking for any brokerage firm, there are multiple options available in India.
But Zerodha stands out from all of these. It offers one of the most affordable services in the market. Moreover, its services are efficient, time-bound and prompt. They do not levy any brokerage fees on the investors. If you use Zerodha, you will have to pay just the trading charges and Zerodha AMC charges which are very affordable.
Zerodha charges 0.01 % brokerage fees for any amount you invest through them. As compared to other brokerage firms, these charges are very reasonable and affordable. This is the reason why more and more number of novice traders are opting for Zerodha as their brokerage firm.
Zerodha deducts the amount of AMC charges from the investor’s trading account. These Zerodha AMC charges go towards keeping the trading account active. Failure to pay for the AMC charges might lead to freezing or even cancellation of the trading account.
In this piece of information, we will be focusing on Zerodha Annual Maintenance Charges (AMC) on a different type of accounts that can be opened under Zerodha.
Let’s begin without wasting too much time!
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Zerodha Annual Maintenance Charges for various accounts
The AMC rates for the accounts opened under Zerodha are different on the basis of the type of account. These AMC charges are to be paid at every quarter. That means Zerodha will deduct the amount after every three months from the investor’s trading account. So per year, four such deductions will take place.
The AMC charging mechanism is very simple in Zerodha. Account holders do not have to worry about missing timelines for payment of the AMC charges as they are directly deducted from the user’s account. This is convenient for both Zerodha and users.
The total AMC along with GST will be divided into four parts, and the charge will be levied accordingly. Let’s take a look on the AMC charges levied upon by the Zeordha on different accounts in detail
- Demat account for individuals
This is the account that will be opened under the name of a single individual. That individual will be taking every decision in relation to the trading. The Annual Maintenance Charge for this type of account is INR 300 + 18 % GST So the total will be INR 354/-
- Demat account for Partnerships and Limited Liability Partnership
This account will be opened in the name of a registered partnership firm or LLP. The annual maintenance charge for this type of account is INR 300 + 18% GST So the total will be INR 354/-
- Demat account for Public ltd and Pvt ltd
This account will be opened under the name of any company registered under the Company’s act. The annual maintenance charge for this type of account is INR 1000 + 18% GST So the total will be INR 1180/-
- Demat account for IL & FS opened before 15the Sept
The charge for these accounts is INR 400 + 18% of GST So the total charge will be INR 472
Important Dates for the Zerodha AMC charges
As mentioned earlier, the user has to pay annual maintenance charge in four parts along with 18% GST. The date on which the charges will be deducted depends on the date of account opening. The next installment will be charged after the exact three months from the date of account opening.
For e.g., if an investor opens his trading account with Zerodha on 1st January 2020, the next installment will fall on 1st April 2020. If the investor opens his trading account on 17th February 2020, then the next installment will fall on 17th May 2020.
Thus, there is no fixed date for payment of AMC. All you need to do is maintain sufficient balance in your trading account. Zerodha’s automatic system will deduct the amount from your account on the given date.
Zerodha AMC on SIPs (Systematic Investment Plan)
Zerodha offers the services for Systematic Investment Plans or SIPs for five major mutual fund schemes. These schemes are:
- DSP small-cap fund
- Mirae Emerging Bluechip fund
- Reliance Small-cap fund
- SBI small-cap mutual fund
- ICICI Prudential small-cap fund
It is important to note that the investment methodology of Zerodha for SIPs is different from others. To avoid any complex documentation and another process, Zerodha collects fund from the investors on regular intervals but deposits them in the form of normal lump sum investment. This strategy is proving very efficient for Zerodha to maintain all the records and ease its business operations.
The AMC charges levied on these services are collected on fixed dates. These dates are 1st, 5th, 10th and 15th of every month.
Ass mentioned above, the AMC charges for Zerodha accounts are minimal, and the best part is, they even offer the facility of paying the amount in four parts. There can be no better option in terms of brokerage firm for novice investors.
Apart from low AMC charges and minimal brokerage fees, they have a good customer support platform that is ready to solve all your queries at once. When you want to start investing in the stock market with very small investments, Zerodha is the perfect firm to start with. Once you start understanding the Stock Market, you can move to other brokerage firms if you wish.
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