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Time of India
a day ago
- Business
- Time of India
Indian MF industry begins a big new push with four states as testing grounds
The Association of Mutual Funds of India ( Amfi ) is on a mission to broaden its investor base significantly. In collaboration with India Post , the organisation is aiming to train around one lakh postmen to serve as mutual fund distributors, The Times of India reported on August 20. This initiative is part of a broader strategy to ensure that every district in selected states has at least ten distributors by the end of the year, ToI's report (by Sidhartha) said. Amfi's chief executive, Venkat Nageswar Chalasani, told ToI that four states -- Bihar, Andhra Pradesh, Odisha and Meghalaya -- will be the testing grounds for this major new initiative. The plan is to train college students in these regions, targeting the addition of 20,000 new distributors within the first year. By the year's end, the goal is to ensure that every district has a minimum of ten trained distributors, with an aim to increase this to twenty by the following year. In addition to training, Amfi is working on partnerships with leading academic institutions to create a "train the trainers" programme. This move will enhance the capacity of local distributors and improve the overall distribution network. Live Events The collaboration with the department of posts also addresses long-standing issues related to KYC (Know Your Customer) compliance for individuals lacking Aadhaar numbers. The initiative aims to revamp India Post's operations, transforming each of its verticals into profit centres. If successful, postmen will take on roles similar to relationship managers in banks, promoting savings products and expanding the reach of mutual fund investments. Currently, approximately 45% of mutual fund investments originate from the bottom 30 towns, while the remaining 65% comes from the top 30 cities. This highlights a significant opportunity for growth in smaller towns and rural areas. Despite an annual influx of about 30,000 new distributors into the mutual fund industry, net additions remain around the 10,000 mark, emphasising the need for increased distribution efforts. The mutual fund sector has experienced remarkable growth in recent years, with the number of folios rising from 2.1 crore in 2019 to 5.6 crore today. Chalasani expressed optimism about doubling this figure in the coming years. He told the newspaper that the campaign has raised considerable awareness about mutual funds, indicating a vast potential market, particularly given the existence of 80 crore bank accounts in India. Currently, assets under management in India's mutual fund sector represent about 21% of the country's GDP. In contrast, developed nations often see this figure exceed 100%, with the global average sitting at around 65%. The potential for growth in India's mutual fund market is substantial.
Time of India
a day ago
- Business
- Time of India
Soon, 1L postmen set to be MF distributors
New Delhi: As part of its efforts to double the investor base, the Association of Mutual Funds of India (Amfi) is working with India Post to train nearly one lakh postmen as distributors, in addition to focusing on four states to ensure that every district has at least 10 distributors by end of the year. Amfi chief executive Venkat Nageswar Chalasani said the industry body has adopted four states, Bihar, Andhra Pradesh, Odisha and Meghalaya, where it is trying to train college students and is targeting 20,000 new distributors in these states in the first year. "By end of the year, we expect at least 10 distributors in each district of these states and at least 20 by next year," said Chalasani. Besides, tie-ups with leading academic institutions are in the offing to "train the trainers". AMFI has already partnered the department of posts to address legacy issues related to KYC of individuals, who did not have Aadhaar numbers seeded. The plan is now to extend it to training postmen as India Post revamps its operations, focusing on turning each of its verticals into a profit centre. If the move goes through, postmen will be like relationship managers in banks, who hawk savings products. For mutual funds nearly 45% of the investments are now coming from the bottom 30 towns, although overall 65% of the share is from the top 30 cities. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Use an AI Writing Tool That Actually Understands Your Voice Grammarly Install Now Undo Annually around 30,000 new distributors join the mutual fund industry but net additions hover around the 10,000-mark. While changing savings habits and online platforms have seen a surge in new investors into mutual funds, especially through systematic investor plans (SIPs), new distributors are seen to be critical in expanding the footprint to smaller towns and rural areas. There is a boom in mutual fund investments in the last few years resulting in the number of folios jumping from 2.1 crore in 2019 to 5.6 crore now. Chalasani said the target is to double it in the next few years. "Our campaign has created tremendous awareness and we will see a massive growth as there is a huge potential," he said, pointing to 80 crore bank accounts in the country. Currently, the assets under management in India are to the tune of 21% of GDP, compared to more than 100% in developed countries and 65% being the global average. Stay informed with the latest business news, updates on bank holidays , public holidays , current gold rate and silver price .
