It is not just retail AUM, which has been increasing in B15 cities. AMFI’s latest data shows that more than half of the mutual fund distributors are from the B15 cities. Of the 82,500 registered individual distributors, over 42,100, or 51%, are from B15 cities.
Experts attribute this to the increasing penetration of mutual funds in the smaller cities and attractive incentives.
“With many fund houses increasing their footprint in the B15 cities through branch offices, there has been an upsurge in the number of distributors,” says Sundeep Sikka, CEO, Reliance Mutual Fund.
Seconding Sundeep’s view, DP Singh, ED & CMO, Domestic Business, SBI Mutual Fund said, “We have seen increasing participation from retail investors, especially from B15 cities. Such investors require handholding by distributors to invest in mutual funds. Another reason for this growth is attractive commission in B15 cities.”
Growing popularity of mutual funds in B15 cities has encouraged people to take up distribution. “No asset class other than equity has performed well for the past few years. Investors in large cities have an option to approach bank and wealth managers with their investment related matters, but people in small cities depend on IFAs for advice on mutual funds. These distributors bring in retail money from B15 cities, which stays with the industry for long term,” said a senior official from HDFC Mutual Fund requesting anonymity.
