At the sixth Cafemutual IFA event (CIFA 2019), Anuj Kumar, MD & CEO, CAMS said that adopting technology was no longer a choice but a necessity.
He began his session by explaining the changes in consumer behavior over the last few years. Giving example of a car purchase, he said, “Earlier, consumers used to visit a showroom and the purchase experience began at the showroom but today it begins on their laptops where they read reviews and compare various cars online”. This change can be attributed to the increased availability and affordability of smartphones and internet. Data shows that there are 100 crore mobile phone users in India while 40 crore people have access to internet - this number is expected to grow to 80 crore by 2022.
Also, digital adoption is no longer limited to a few categories of individuals. Along with ‘3M – men, metro and millennials’, women and rural population are also embracing digital platforms. All in all, digital technology is penetrating many sectors and transforming their business models.
Financial services industry is at the forefront of this boom. Data shows that around 70% of Indians already use some form of digital service (transactions on an online platform or scheme evaluation) in their financial product purchase journey.
As more and more Indians adopt technology, their service parameters will also change. As they get used to the instantaneous notifications and one-click purchase options on e-commerce websites and ride hailing apps, they would expect the same ease of transactions in their financial investments as well.
Sharing CAMS data, he noted that 42 lakh new investors (new PAN) entered the mutual fund fold in 2018, of them 60% were from T30 cities, 60% had invested in a SIP and half of them were below 40 years of age. These SIP investors will need long-term engagement and regular updates and having a robust online platform will make client servicing of distributors easier.
He also shared that unlike a decade back, when digitizing the business needed substantial investment, advisors now can hook their business to any online transaction platform of his choice at an affordable price. These platforms, R&T agents and fund houses are offering tools and options to digitize their business.
At its peak, 20% of the KYC was being done electronically; while the Supreme Court’s judgment has halted Aadhaar based eKYC, platforms are offering other tools to digitize the process. Exceeding that number should be our target, feels Anuj. While there will be road blocks along the way, we need to work towards making the process of transaction and servicing clients seamless.
He concluded the session by saying that as clients embrace digitization in travel booking and online purchase, they will expect their financial transactions to be as easy and at a click of a button too. You may lose clients by not being digitally equipped. So, latch on to the digital trend, incorporate the new capabilities offered, be more productive and sell more.
