Despite lockdown, MF industry adds over 1 lakh new investors in April

Even amid the nationwide lockdown and volatile equity markets, the MF industry has added over 1 lakh new investors in April.

In April, the MF industry added 1.11 lakh unique investors with PAN, taking the overall count to 2.04 crore investors from 2.03 crore investors in March. Besides, there are 4.50 lakh unique investors without PAN which takes the overall unique investors count to 2.09 crore as of April, 2020.

However, if we dig deeper, the MF industry has witnessed a marginal slowdown in terms of addition of new investors. The industry had added 1.45 lakh new investors in March, 2.23 lakh in February and 1.51 lakh in January.

Nevertheless, given the circumstances, April numbers are no less than heartening, feels experts. Especially given the fact that many distributors, advisors and bank RMs rely heavily on in person meetings and physical transactions to onboard clients.

Swarup Mohanty, Mirae Asset MF said that the industry adding over 1 lakh investors is a sign that various stakeholders are migrating to the digital route.

Experts feel that most of the new investors have come via tech distribution platforms.

Sunil Subramaniam, MD, Sundaram MF said that some of the online platforms have already done KYC of their users. This makes the task of initiating mutual fund investments quite easy for them.

The fact that people have to stay at home has prompted them to look at the digital route for investment.

Mukesh P Kalra, Founder and CEO, ET Money said that since onboarding in mutual funds is completely digital on their platform, they haven't seen any negative trend. In fact, they have witnessed a rise in addition of new investors in the past couple of months.

Some of the tech savvy national distributors have also brought a considerable number of new investors. Husaini Kanchwala, Product Head - MF at NJ India said that they added around 12,000 new investors despite the fact that April is a lean month for mutual fund business.