The mutual fund industry has added 7607 new distributors in April-December 2016, shows an AMFI note sent to fund houses.
In fact, this is close to what the industry had added in the entire year in the earlier financial year, 2015-16. AMFI data shows that the industry had added 8154 new distributors last financial as against 6,523 new ARN registrations in FY 2014-15.
Of these new registrations, 6926 ARNs relate to individual distributors while 16 and 663 are new cadre of distributors and corporates respectively. The industry added the maximum number of distributors (974) in September.
Sundeep Sikka, CEO, Reliance Mutual Fund attributed this growth to the growing acceptance of mutual funds among investors. “Due to increased awareness about mutual funds, many investors want to invest in mutual funds, especially through SIP route. If demand increases, there has to be a strong supply chain to cater to investors.” However, Sundeep says that the current base of distributors is small and the industry needs more distributors to increase penetration of mutual funds.
The CEO of an emerging fund house is of the view that the growth in number of new distributors has come from B15 cities. “The increased number of distributors will surely help industry expand its footprint. This growth has largely come from B15 cities as mutual funds have gained traction in such cities.”
However, some experts have a different view. Nimesh Shah, MD & CEO, ICICI Prudential MF said that this is not a good sign for the industry. “In a country where total population is over 1.25 billion, 7600 new distributors is a small number.”
Further, AMFI data shows that over 11779 ARNs got renewed in the first nine months. Of these, over 10900 ARN renewals were from the individual category. In FY 2015-16, 15262 ARNs were renewed.
As on December 2016, the mutual fund industry has over 1.67 lakh ARNs of which 77,142 are individual and 90,229 are employees.
All these distributors are KYD complaint ARN holders.
