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Guest Column ‘When change is inevitable, let us embrace it in the right spirit’

‘When change is inevitable, let us embrace it in the right spirit’

“Much bad advice is given for free.” These are the words written by Benjamin Graham, in his famous book, The Intelligent Investor.
Kamal Manocha Jul 20, 2017

We are used to a culture where giving free advice is common practice. Free advice is not a bad thing, but only if it is restricted to general aspects of life. When it comes to technical aspects, free advice may actually turn out to be a bad thing. We should not forget that lack of technical depth led to many bad decisions. This is the reason, when it comes to career counselling, medical counselling and legal counselling, we believe in fee based professional advice, not free advice. It is the same with fee based financial advice. SEBI’s recent consultation paper on investment advisor seeks to grant financial advice the status of a profession. Isn’t it a good development?

Financial products like mutual funds, stocks, PMSs, AIFs, insurance, etc. are not simple products and that is the reason a financial advisor plays an important role. The problem is that brokers and distributors freely call themselves equity advisor, insurance advisor, mutual fund advisor, wealth advisor, independent financial advisor, and so on. Since an advisor plays an important role, the real question is the use of these professional labels without the necessary certifications and licences.

It’s a good thing to obtain a licence as it certifies you as being authentic, but many distributors are confused. These changes are inevitable and all those who are true advisors, not just product sellers, must embrace these changes in the right spirit.

SEBI has been inviting mutual fund distributors to register themselves as RIAs since January 2013. However, we have only around 500 RIAs against 85,000 mutual fund distributors who freely call themselves investment advisors. Many distributors largely believe that investment advisory is sales. Nothing strange in it therefore if aspects like asset allocation remain limited to tick-mark exercises, which is what is noticeable in almost every second portfolio.

But the real problem for many distributors is that once they obtain an RIA licence, they get into a fiduciary relationship with clients. This is exactly like doctor's profession. A doctor in principle cannot earn commission from the medicines prescribed; similarly, a licensed advisor needs to sacrifice the upfront and the trail commissions received from AMCs to practise advisory lawfully. Currently, commissions drive sales figures. In fact, in a few instances, a few players share some component of commissions with their clients by way of revenue pass backs.

In the backdrop of all these issues, SEBI’s consultation paper is a much needed step. In my view, proposals in the consultation paper will attract a fair competition and create a level playing field.

Fact of the matter is that there is actually a huge difference in the advisory approach of distributors versus RIAs. Things like risk profiling, asset allocation, unbiased fund selection and portfolio review, which are critical aspects of investment advisory, remain restricted to theoretical concepts in the sales approach as the focus is always on the product. On the other hand, an advisory approach truly focuses on the needs of clients. For an advisor, there is no conflict of interest and his way of working revolves around financial planning, maintaining an optimal portfolio and aiming to generate consistent high performance. This is because when your earning depends upon customer fees rather than commissions, you have no option but to provide quality advice.

Most investors do not really know how to distinguish between an advisor and a distributor. Once SEBI segregates both these activities, i.e., fee based and commission based, more distributors will obtain an RIA licence. This will further enhance respect for this profession. The potential for the advisory market in our country is huge; we must therefore view the proposed changes in a positive manner.

Kamal Manocha is the Chief Executive Officer of Bharosa Advisor, a SEBI registered investment advisory firm.

The views expressed in this article are solely of the author and do not necessarily reflect the views of Cafemutual.

 

35 Comments
Ranjan D Gupta · 4 months ago
I understand what SEBI wants to do. But there should be a level playing ground. If all the distributor be shifted to RIA model then there should not be any direct investment system by the investors. Because when it is compared to the professionals like doctors. Medical council does not that a patients can treat themselves on their own. So direct investment is also detrimental to financial health. Apart from this SEBI must introduce rule of minimum fees in percentage term on the amount of investment compulsoryly to be paid to RIA and without that any investment would not be processed .
Gaurav Parikh · 3 months ago
I completely agree with you Mr Gupta , in addition to the minimum fee as mentioned in your post it should be in accordance to cover the expenditure and services provided by the RIA.
Reply
Dutt Sharma · 4 months ago
We all appreciate, what SEBI is trying to do. However, any Regulation to work, needs proper framework of LEVEL PLAYING FIELD and road map to see that it works. In the same financial sector, we cannot have discriminatory treatment of Insurance and Mutual Fund and other products. We cannot have different class of Advisors for Insurance and Mutual Funds. Has anyone put low limits on Insurance Brokerages ..? Has anyone asked them not to sell Insurance as an Investment ..?? GST again the same story .. Mutual Fund Distributors are supposedly giving service to the FUND where as Insurance is service paid by Customer ..!! Much heart burn is due to discriminations.
Secondly, haven't we all experienced fleecing from Medical Professionals ..? Hospitals ..?? Frivolous Charges ..?? How do we control that in an Advisory Model in absence of any caps ..?? Aren't Hospitals and Doctors answerable to FIDUCIARY CHARGES ..?? How Good are we at that ..??
So mere speculation if Advisory is Good or Bad will not help. Proper framework BEFORE IMPLEMENTATION is the need of the hour.
Meet Sugat · 4 months ago
What % of people say, I want to invest let's go to advisor ?
kamal Manocha · 4 months ago
Thanks for a very good and straight question.

This percentage is directly proportionate to the % of advisors. If currently, there are say 5% advisors and 95% distributors, so % of people who say, lets to go advisor are also 5%. Tomorrow, if there are say 95% advisors and 5% distributors, obviously 95% people will say lets go to the advisor. Its all in your own hands.

Accepting change is always difficult, my friend there is saying that 'old ways do not open new doors'.

If we really want penetration to go up, if we really want enhanced respect, financial advisory needs to become a profession.

If this happens the day is not far off that every indian who today invests in traditional products will respectfully approach his advisor and with advise the mutual fund industry will be at 100 lac crore.

AMFI wants it till 2025, because it believes in Distribution based Push approach.

This is possible much before, with Advise based Pull approach ..

Don't be afraid of the change, you may lose something good, but, you may gain something better.
Hari · 4 months ago
Again, Mr Kamal, your assumption of 5% will go to adviser is appears to be baseless. How did you arrive to that conclusion? You are a CEO, so please make statements sensibly.
kamal manocha · 4 months ago
Pls read what i mentioned earlier, it says, "say 5%". you wanted %, and, this % depends upon number of advisors. thanks
Reply
Rashmikant K Ashani · 4 months ago
The article itself is a free opinion, unsolicited so should be ignored
kamal Manocha · 4 months ago
Exactly my thought! Not everybody takes Free Advice seriously and this is why inspite of 85000 distributors, the penetration is so low. Accept the change and see the magic of pull created by perceived value of fee based advice.
Hari · 4 months ago
Mr Kamal, it seems you don't like competition. You want to erase the distributor segment so that you alone make money. Certainly I see NO good intentions.
kamal manocha · 4 months ago
Who am i to erase to create? Its in ones own hands. If one is a distributor, and if one takes an advisory license, will it erase one or re-create one. Only one can answer to oneself.

I am being very humble, and submitting my views. You'r welcome to ignore. i already acknowledged.
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Robin Vas · 4 months ago
What SEBI intends to achieve is well appreciated. But, it is too early to implement this measure because the Mutual Fund market in India is not mature enough. This can definitely be implemented in future. At present, the awareness of Mutual funds is very little among customers. The distributors have a very tough job of convincing the people for the need to invest in mutual funds. In fact they are helping the people to graduate from being a SAVER to an INVESTOR. Fee can be charged for the people who approach the advisor by themselves (like going to a doctor). But, in case of Mutual fund investments, the mutual fund advisor has to approach the people, educate them and motivate them to get into investment (in 99% of the cases). In this scenario, how can any one expect to collect a fee from them? SEBI should show the prudence of waiting for few more years and allow the market to mature. If SEBI chooses to force a fee based model now, it will hamper the mutual fund penetration and majority of common people will lose the opportunity to get into mutual funds.
Kamal manocha · 4 months ago
Fee based advisory is utmost important for addressing penetration. Free advice is not sending the message across as free things are generally ignored. If all adopt fee based advisory approach, trust me, a perceived value will pull investors to you and automatically market will get penetrated. MFs are obviously a better asset class, but people still invest in FDs, Real assets. Clearly not a Sales Gap as we have almost 1 lacs distributors already. Its a perceived value Gap, which only a fee based advisory can fill.
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Sudhir Kulkarni · 4 months ago
None of the mis-selling Bank has been brought to book till date. They are only given free & soft advise to exercise "internal control" without any action being initiated for deviations. In process only IFAs & Investors have to suffer.
Investors would be left in the lurch by having to pay hefty fees for so called financial planning to CFAs with whom no investor shares complete portfolio! Complete disconnect between investment advise & actual investments by an investor - Arms length investing!!!. Jai CFAs!
Ankit · 4 months ago
I know few people will not agree but many will agree, recently a very informed person told about how lobbying is affecting Mutual fund Industry.
Yes, Big distributors or banks who can float their independent Distribution and Advisory branches are doing it. Same is being done by many so called fee-based Advisors. They have access to rich and HNIs and very easily they can charge their fees and make them invest direct. They are influencing the decision makers.
But they all are afraid of small distributors who are bringing small retail investors to Mutual Funds as everybody knows sooner they will be in huge numbers and will have a bigger role play in the decision-making process.
This is the reason why new regulations are coming every now and then, just to keep people like us at bay. So all the distributors stay strong and united, keep doing what you are doing. One day we will be in a position where we can challenge their monopoly and make things better for us.
Pradeep B Jamsandekar · 4 months ago
The time and society is not ripe for fee based model. It will cause more harm than benefits to the industry and the country at large. Distributors are wise enough to choose their own path. Thanks
sudhanshu arora · 4 months ago
1.Who says MFDs(untill now we were called IFAs) are not certified? SEBI mandated AMFI certification exam, for us and we acquired that certification. Then SEBI mandated CPE(continuing professional education), which we are doing after every 3 years, without which our licenses may get cancelled.

2. Our experience+ Amfi certification- these 2 things are sufficient for giving mutual fund products to retail investors. There is not much rocket science involved in it, about which so called new breed of RIAs are creating hype, with fancy words like risk profiling,asset allocation and blah blah. We all have been doing these things for long.

3. Most of individual agents like me get business from relatives, friends,colleagues etc. and since we to live in the same society, so we people are already bearing that responsibility part-you can call it fiduciary responsibility, moral/social responsibility or what ever name you may like to give it to.

4. Are fee based professional true and loyal to their clients?

Don't we hear of doctors recommending unnecessary tests/ surgeries and prescribing costly medicines( for which they get perks from pharma companies) instead of generic ones?

Tomorrow if AMCs start giving under the table benefits to RIAs to recommend their products?Then?

5. If distributors are not adopting to become RIA, it does not mean that they are thieves. Its only because of the fact that looking at the Indian culture, they do not find RIA model viable.
Hari · 4 months ago
Well said Mr Sudhanshu.
Reply
kamal Manocha · 4 months ago

Thank you all for your comments.

Change is a natural phenomenon. It has already begun. We have to wait for the formal announcement. It is plain and simple segregation of Agents from Advisors. Highly needed and quite logical. A change in favour of investors, Advisory profession and Industry.

Free advice is generally ignored and not taken seriously, this is the reason, inspite of mutual fund being a great product, and india being largely a country of Savers, the mutual fund penetration is alarmingly low.

Inspite of more than 85000 distributors, people have been investing largely in low return assets like FDs, Gold, Real Estate, other Real assets. This is clearly an advisory Gap, not a Sales Gap.

Fee based advisory has power of creating a Pull because of its perceived value. And, this power of pull is what is needed..

For all those who still view Advisory just as Sales and do not see it given 'The Stature of a Profession' can happily ignore views expressed, and opt to remain product sellers/brokers.

For all those, who see the role of a financial advisor as highly as it getting recognised and differentiated as a Profession, must soon consider adopting a fiduciary model to continue to be called "Financial Advisors"

Bottom line - SEBI is helping the profession, industry and investors, as all these are inter-related. A solid product like mutual funds with a such good track record doesn't need Sellers. So, better is to accept the Change as Advisory is going to create a differentiation. If the more people adopt a professional status, perceived value will invigorate pull and that is what would migrate people to mutual funds.

Label of ADVISOR carries a power of influencing decisions and must not be allowed to Distributors who sell for Commissions. This is especially needed in india as financial education is low and people tend to get influenced with these Labels ..
Nishikant · 4 months ago
plz explain, how fee based advisory will increase penetration. After nearly 20 years, MF industry is still confined to Metros & top 30 - 35 cities. there r no AMC offices or CAMS or karvy in major part of the country. it is only the small distributor who is working on behalf of MF industry in small cities, towns with no support from AMC or registrar.

even newly licenced Microfinance banks like equitas, AU, Janlaxmi has opened branches in every small city & town in just few months & MF industry can't done that even after 20 years.

How can 86,000 MF distributors with no infra back up compete with life insurance products with 35% commission & workforce of 20 lakh insurance agents. how can MFD compete with Nationalised banks, pvt. banks, co - op banks, micro finance banks which r located in every nook & corner of the country.

how can he compete with fraud chit funds & societies who pays huge commissions to their business associate. MF penetration low only due to lack sales push & not due advisory gap. it is purely a sales gap. if u can't spread ur wings u can not acquire new investors no matter how good, transparent, high return, well regulated is your product.

How can he compete with other products with 18% GST + 10 -20% income tax with thin margins.

just look at the inflows after B15 incentives. if u want to grow & penetrate u have pay for it. Direct plans, RIAs can work only in metros & big cities. Small cities,towns don't even know MF as a product, forget about the RIA, Advisory fee. Requirements of semi urban india is totally different from the requirements of metros.

you can't have only one set of rule for diverse & huge country like india which has lowest awareness level about financial world.
Kamal Manocha · 4 months ago
Ask yourself following 3 questions
- Is equity mutual fund a great product for wealth creation or not?
- Is ELSS a great product for tax saving under sec 80c or not?
- Is debt mutual fund a great product to get beat inflation and wealth preservation.

If the answer to all 3 questions is yes.
Then ask yourself following 3 questions.

1) Is an indian consumer smart or dudd
2) Is an india
Kamal Manocha · 4 months ago
Ask yourself following 3 questions
- Is equity mutual fund a great product for wealth creation or not?
- Is ELSS a great product for tax saving under sec 80c or not?
- Is debt mutual fund a great product to beat inflation and wealth preservation.

If the answer to all 3 questions is yes.
Then ask yourself following 3 questions.

1) Is indian consumer smart?
2) Is indian consumer believer of saving money?
3) Is india consumer young?

If the answer to all 3 questions is yes.

Then ask yourself, how many clients can an average advisor reach out and manage.

We have around 1 lac distributors and around 1.5 cr mutual fund investors. This means one distributor is reaching out to 150 clients. Clearly there is no sales gap. There is a advise gap. For a product which is good, for a consumer who is smart, for a consumer who is young, if the perception about mutual funds was good, people would have got pulled towards it. And, only pull makes up the penetration. Otherwise as per your logic if 100 cr people are to invest in mutual funds, we need 66 lacs distributors. Those who believe so, basically believe that mutual fund is a push product and hence favour the sales approach. This way we will never be able to increase penetration.

Only way possible is if people start asking for mutual funds instead of traditional products. Smart people donot need IAP sessions to know which is better product. Its a wrong approach.

Assume there are 50% fee based advisors. Say 40000 advisors. Now, the people who pay fees take interest and take advice seriously. This will lead to pull.

There was a time when everyone use to study medical science, then there was a time people use to do engineering, there was a time people use to study MBA.

Don't you want a time when people move away from traditional investment products to mutual funds. For this word of mouth is required, change in perception is required. Fee based advisory makes a distributor a professional, a brand, he only becomes independent financial advisor in true sense with fee based model.

Instead of he going to people and spending so much effort, people come to him. This is the pull of a changed perception.

Hence, an agent must welcome the changes and look forward to becoming an advisor.

nishikant · 4 months ago
I know Mf is definitely a great product, but indians still don't invest in it due to sales pressure & aggresive mkting by other financial products like insuarnce, Bank FDs as they have reach & presence in every nook & corner of this country. fee based advisory will be good only for corporates, HNI & big investors. it will only cater "top cream" exisitng investors but can not reach out "first time new investors" or small ticket size investors.

how many clients RIA can handle ?? How many RIAs will be rquired to cater 100 crores investors ???

what u suggest in city which has no AMC office or cams or karvy. RIA or MF Distributor. RIA will only serve matured, aware, smart HNI investors in big cities. though india is a great growth story, one prolong bear market of 4-5 years can wipe out all these so called "Big smart savers", they will be the first to get out of the markets without even consulting their RIAs.

Reply
Hari · 4 months ago
Mr Kamal, why do you assume that distributors will have a different advisory approach? This is a wrong assumption and you piled up your thesis on this assumption. please don't under estimate. They too advise ethically. If you can't believe, sit with me will show my investors portfolio.

Rgds
Hari
kamal manocha · 4 months ago
Hari - There is no assumption, neither there is any doubt. I am not at all afraid of competition and absolutely i am not under-estimating any effort.

The question of real competition and real ethics comes, if You offer commission free plans to your clients, and charge them fee.
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Anil Khandel · 4 months ago
ICICI and HDFC MF openly promote direct (see their website). Bank sponsored MF still sell close ended products as FD and SEBI is allowing one after another close-ended schemes of these monstors. This is India where banks loot but pardoned. Now these same people want distributors out of job so that they can have 100% control in MF market.
Even Reliance, Birla etc not sponsored by banks will see big drop in market share. SEBI & people like you are just puppet of these banks.
Otherwise how can you imagine a new rule for MF without touching insurance sector and having a level playing field.
Suresh · 4 months ago
Very well articulated Kamal. Many may not like it. But we need to embrace change. Well said????
Paul · 4 months ago
Mr Kamal does a person who wants to invest Rs 1000 p.m. get advise., from an advisor. Did you advise anybody? with such a low investment need and what did you CHARGE. MFs are a product for the small investor, it was never a product for the large investor, large investors have products like PMS, AIFs etc.... Infact, if we want it to be fair, SEBI should put a cap on the amount of investment for large/small players. Large players also have an option to go DIRECT, still they go to an Distributor, WHY???
Kamal Manocha · 4 months ago
Lets together suggest Sebi that regulations should be brought in phases and in the first phase for those distributors who manage more than say 100 cr of AUM say or whose average AUM per client is more than 1 lac. These large distributors who are not helping penetration and primarily managing large AUM must adopt RIA approach. Numbers may be more or less. I am just sharing a view point basis your argument because your 1000 per month argument is right and i agree.
Reply
Paul · 4 months ago
All rules are done only keeping the needs of the large investor. eg : the Direct option, how many small investors go DIRECT, any data on that. Even this whole discussion is basically keeping the interest of a few in mind., not the investors. Tell me would an Advisor go to 25 kms to service a NEW ticket size of Rs 5000 p.m. and spend 2-3 explaining the concepts of investment. I DOUBT THAT??? Hence the level playing field or decisions should be done keeping in mind the SMALL INVESTOR and not LARGE INVESTORs that you or I may be servicing. You are welcome to check how many small investors like Rs 5000/- pm. that a distributor services and what YOU ADVISORS service. Sorry it may sound rude, but remember MFs is for small investors not LARGE Investors. Large investors take the advantage of such products available for small investors and then rules are framed to protect their interest at the cost of the SMALL Investor. Let SEBI look at the data of distributors who are servicing SMALL investors and then frame rules., how will new first time investors be serviced, each advisor should compulsory have an X amount of his business from small ticket sizes., say 50%. For each new large client, that an advisor/distributor, he/she should be asked to service 10 -15 small clients. Then it is a level playing field. WHAT SAY????
Ganesh Kumar Gupta · 4 months ago
1. The whole idea of RIA is suitable for HNI, not small investors for whom MF it is meant for. However HNI shall be encouraged in purchasing shares directly so that we can have a healthy capital market which is also necessary for success of MF.

2. B15 commission which is LEGAL is meant for promoting small investments in small towns. SEBI publicly accepted that B15 commission is successful in bringing more investors of small towns to MF. If market as you said is so matured, B15 concept would not have been there legally.

3. Further being an 'interested' party is it allowed for you to write such article legally ? Go through the terms and conditions of your licence.

4. People sitting in AC rooms with ROBO do not understand how a SIP of Rs. 500 is opened by a IFA in a remote town like Golaghat, Assam. Forget about fees, we have to literally chase them and convince them to invest and often we got rejected and you are dreaming that people will come RIA (doctor)'s chamber to pay fees. Brother, you must be in a dilemma. Better become a distributor since you are also charging fees upto Rs. 50,000. Isn't it ?

5. By the way, we are certified professionals having 10+ years experience having passed AMFI exams twice with 80% marks. Never think that you know more than us.

6. Based on SEBI data, RIA is a concept which has failed to take off in India and hence SEBI should discard it as India is a developing country. It failed even in USA. As long as RIAs are there, they will push SEBI to close down a time-tested concept which is working hard to reach every nook and corner of India.
Ganesh Kumar Gupta · 4 months ago
1. The whole idea of RIA is suitable for HNI, not small investors for whom MF it is meant for. However HNI shall be encouraged in purchasing shares directly so that we can have a healthy capital market which is also necessary for success of MF.

2. B15 commission which is LEGAL is meant for promoting small investments in small towns. SEBI publicly accepted that B15 commission is successful in bringing more investors of small towns to MF. If market as you said is so matured, B15 concept would not have been there legally.

3. Further being an 'interested' party is it allowed for you to write such article legally ? Go through the terms and conditions of your licence.

4. People sitting in AC rooms with ROBO do not understand how a SIP of Rs. 500 is opened by a IFA in a remote town like Golaghat, Assam. Forget about fees, we have to literally chase them and convince them to invest and often we got rejected and you are dreaming that people will come RIA (doctor)'s chamber to pay fees. Brother, you must be in a dilemma. Better become a distributor since you are also charging fees upto Rs. 50,000. Isn't it ?

5. By the way, we are certified professionals having 10+ years experience having passed AMFI exams twice with 80% marks. Never think that you know more than us.

6. Based on SEBI data, RIA is a concept which has failed to take off in India and hence SEBI should discard it as India is a developing country. It failed even in USA. As long as RIAs are there, they will push SEBI to close down a time-tested concept which is working hard to reach every nook and corner of India.
Rasik · 4 months ago
It appears that moe or less it is agreed that RIA services are sought by large investors/HNIs who are Financially well educated/aware. But recently a read that nearly 90% of earning individuals in India are found to be wanting if asked to name Financial investment products other than Bank Deposits. Now, we MFD/IFAs are their nearest available source of information and guidance . By enforcing RIA model are we not depriving them of an easy access person? A small investor, like a villager, will be afraid of stepping in RIA' s office. We are instead approaching such newbies to explain Mutual Fund product and assist him explore it.
Besides, RIA will be also relieved if such small investors are taken off their backs to enable them to cater to HNI's from whom earnings will be much higher!!! Least their valuable time will get wasted.
As such it will be mutually beneficial for both categories persist side-by-side. Please think again !
kamal Manocha · 4 months ago
Sir, Thanks for sharing your views. Let me try and put some light, so that confusion goes away.

1) You are right. So, if RIA is suitable to HNI, let us first acknowledge that and then let SEBI start it from here. And, let industry define who is HNI and who retail. Okay?

2) Where did i say, B15 commission is not legal? The real issue is why does a good product need so much selling incentive? Tell me one thing, is there anyone who sells gold? people buy gold. If mutual fund is a great product, and has a track record of 20 yrs, why do we still need it to be sold with concept of high commissions? Ok let me ask you another question, till when do you think it should continue like this? There are many places and venues that sell mutual funds. More than 1 lac distributors. Trail commissions as high as 2-3%. Penetration is still abysmally low at around 1-2%, I am sure you know this? how many years do you think are required for penetration to go higher. My friend, clearly, it is not because of Sales Gap. It is because of Advice Gap.

If people start perceiving about mutual funds a professional product to build wealth, to save tax, and to park retirement corpus, they will obviously themselves come to you. And, today people do not perceive it like that inspite of distribution effort of 20 yrs because, agents are selling it for commission.

Doctor becomes a doctor not just because he has a degree. No one asks for degree. He becomes a doctor, because patient perceives him a doctor. I agree with you that this change is a Big change and hence i am also of the view that it has to happen in phases. But, you first acknowledge, that it is a good change for this profession, for industry, and it is change which is needed. Then comes the question of how Change should come. In what phases. HNIs Vs Retail. etc Okay?

3) SEBI is asking for a public opinion and has been wanting to bring segregation of Advisors from Agents since Jan 2013? Do you know this? It has issued 2 consultation papers on this? Do you know this? Constitution of India gives me right to speech and share my views and opinion. Pls don't confuse the situation. Okay?

4) Deploying an AC is the room not a matter of discussion. Okay? I know, the effort required to acquire an new client. I acknowledge that. FYI, our my advisory fee ranges from Rs 1000 (min) to 50000 (upper cap). Otherwise in between it is 25 basis points of AUM. And, this is per annum. Okay?

5) Even 100 yrs of experience and 100 % in Course on Pharmacy doesn't make a chemist a doctor. For one to become a doctor, one needs to first decide to be a doctor, then take right certification and practice with fiduciary responsibility. I have no doubt that you know a lot. Please do not take me wrong here. Everyone know and that is not a matter of discussion. Professional career is a matter of personal choice. But, if you'r not a doctor, you can not be called a doctor. Okay?

6) RIA hasn't even come in india. It is not a new concept. Advisory as a profession is successful in every field, be it Medical science, Law, Accountancy, Taxation, Career development, Consulting. Similarly RIA is Investment Advisory. There are many countries that have adopted it and are running very successfully with it. UK is one of the examples. Please check. USA has also adopted it inspite of mass opinion by banks and distributors that it may not happen. SEBI is cognisant of all international developments and will obviously see the experience of other countries for seamless implementation. RIA is not a closing down of time tested concept. It is a advancement of a time tested concept where by in first phase, let HNIs be made to opt for RIA model and let Retail remain with the distribution. You should first acknowledge its a good development especially in indian context as people need to know who is advisor and who is agent. Okay?
Vimala B · 3 months ago
This article is very well written - I applaud the difficult part your company has chosen to serve its clients. I have tried to be transparent to my clients and lost some but those that stuck on and chose to pay fees have recommended their friends to me as they are appreciating my transparent approach.
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