“The saga of the Indian mutual fund industry has come a long way from its humble beginning since the past 25 years. Invariably, every year has been a year of great learning in both positive and challenging ways. Over the years, the industry has not only grown but also has made suitable changes with the continuous guidance of SEBI. While I agree, that the current mandates may hit the revenue model but given the large opportunity that still persists, there is enough scope to maximize revenue at every stakeholder level in the industry.
Having said that, I must also mention that the scope and the untapped potential in India is still very huge. Indian mutual fund Industry is just 18% (Source: RBI) of the overall banking deposit base. Ultimately, the larger success of the partners would be mainly driven by 2 parameters namely, adding new customers and maintaining asset mix – equity & debt.
Currently, less than 2% (Source: AMFI) of the total Indian population invests in mutual funds. Hence acquiring new customers is the key to ensure that advisors maintain or increase their current level of revenues.
Secondly, Of the total 120 lakh crores of the banking deposit base, 60% or 70 lakh crores of the deposit base lies in fixed deposits. (Source: RBI) It could be assumed that every customer you may have ever acquired would have invested in FDs with banks. Hence, proposing a fixed Income scheme, to such investors can be a good opportunity for any advisor.” says Bala, CEO, Aditya Birla SL Mutual Fund.