Furthermore, this commission is paid every quarter on the current Assets Under Management (AUM) and not on initial investment. For e.g. if you had invested say Rs. 10 lac at the start of year 1, and at end of first year, you have Rs. 12 lac, your broker gets a commission of 0.5% * 12,00,000 = Rs. 6800.
Now if your investment value at the end of next year is say Rs. 15 lac, then the broker gets 0.5% * 15,00,000 = Rs. 7500.
He/she gets the commission despite you making any new investment in that fund. Even if you stop making new investments, or stop dealing with that broker, but leave the money invested in the funds invested through him/her, he/she still gets commission due to his/her AMFI Registration Number (AMR) code being attached to your investment.