With just one distributor for every 17,000 people, there is a huge opportunity in this space, say experts
Seeing a growing need for Mutual Fund (MF) distributors, top Asset Management Companies (AMCs) along with NSE and CIEL plan to have 50,000 new MF distributors over the next three years.
This is being done under the aegis of ExpertMFD, a first pan-India collaborative initiative comprising top AMCs that manage over two-third of the total AUM in the Mutual Fund (MF) industry.
The AMCs --- Aditya Birla Sun Life Mutual Fund, Axis MF, ICICI Prudential MF, L&T MF, Nippon India MF, SBI Mutual Fund, and Sundaram MF -- that have joined hands with NSE (National Stock Exchange) and CIEL (Centre for Investment Education and Learning).
ExpertMFD will offer end-to-end support for anyone who wants to make a career as an expert financial distributor.
"The only requirement for anyone to join the MF industry is to have a robust understanding of the subject and support from the ecosystem," Himanshu Vyapak, MD of CIEL, said in a virtual press conference on Tuesday.
CIEL would provide the required training and NSE would be a transaction partner for enabling the business digitally.
According to Vyapak, mutual funds have emerged as an attractive avenue to promote financialisation of assets and earn market-linked returns over the long-term with disciplined financial planning. However, hand-holding is required for new as well as experienced investors.
"We have about 2.3 crore unique MF investors in India. The growth in MF distributors has not kept pace with the growth of assets in the MF Industry. Our endeavour is to build a strong foundation and a cohesive growth environment for future financial experts by providing a full-stack end-to-end platform for anyone who wants to become an expert financial distributor," he said.
The consortium of top AMCs believes that the industry is ready for next-level growth and is expected to be Rs 100 lakh crore over the next 10 years.
However, there is just one distributor for every 17,000 people, indicating opportunity in this space.
"With lesser distributors serving more and more customers, it is a huge opportunity for new financial distributors to join the industry and make an impact. The success of the industry will lot depend on how we work towards expanding the distributor network and move to rural India," the consortium of top AMCs said.
According to an estimate, top individual MF distributors earn more than Rs 1 crore in annual gross commissions, indicating the potential for earnings.
NSE Indices Ltd CEO Mukesh Agarwal said this strategic partnership will create unique possibilities to promote the distribution of mutual funds to the large Indian population.
"We see a great potential in having a first in industry one-stop platform for anyone like an insurance agent, homemaker, student, retired professional, etc. to start their mutual fund distribution journey," he added.