Even as India’s top mutual fund distributors witnessed a marginal increase in the assets under their advisory, the gross commission earned by them saw a sharp decline in FY 2019-20.
An analysis of AMFI’s latest data on commission disclosure shows that India’s top mutual fund distributors managed nearly Rs 10.08 lakh crore in FY 2019-20. This is nearly 41% of MF industry’s total Rs 24.7 lakh crore AUM.
In the preceding fiscal i.e FY 2018-19, top MFDs managed Rs.10.05 lakh crore. This was nearly 40% of the industry’s total AUM of Rs.25.50 lakh crore.
Meanwhile, commission paid to top MFDs declined to Rs 6,134 crore in FY 2019-20, as against Rs 7,948 crore in FY 2018-19.
This means while the assets managed by top MFDs rose by a marginal 0.3% in FY 2019-20, the gross commission earned by them declined by nearly 23%.
One of the key reasons for this decline in commission payout is the sharp fall in total equity AUM. AMFI data shows that the total equity AUM fell to Rs 5.78 lakh crore on 31st March, 2020 from Rs 7.44 lakh crore a year ago.
According to SEBI, top distributors are those who meet any of these four criteria:
- Having presence in at least 20 locations
- Managing AUM of at least Rs.100 crore
- Receiving gross commission of at least Rs.1 crore
- Receiving gross commission of Rs.50 lakh from a single fund house
While there were 1037 MFDs that fell under the purview of ‘top distributors’ in FY 2018-19, there were 852 top distributors in FY 2019-20. The list includes banks, NDs and individual MFDs.
