Birla Sun Life Mutual Fund is seeking to build loyalty among distributors; it has begun offering a contributory pension benefit to select distributors
Mumbai: Birla Sun Life Mutual Fund, India’s fifth largest fund house, has started offering pension benefit as an incentive to its distributors, according to two officials in the know. The pension benefit has been provided to selected distributors from Kolkata on a pilot basis.
The fund house is likely to soon offer the pension benefit to its empanelled distributors across the country.
Birla Sun Life did not respond to an email query send on Tuesday. But a senior official from the fund house confirmed it was offering pension facility to distributors empanelled with it.
The officials Cafemutual spoke to said the pension scheme would be based on contributions from the distributors. The contributions would be deducted from the trail commissions received every month. The fund house is likely to deduct 5 per cent towards pension every month and invest the money in a pension plan. Other details of the offer could not be obtained.
Officials at other mutual funds said the pension benefit is a loyalty programme aimed at ensuring higher sales of Birla Sun Life products by distributors who opt for the scheme.
Three years back, UTI Mutual Fund started offering a voluntary pension plan to its distributors. Till now 400 IFAs have opted for its scheme. Under this scheme, an IFA can choose an amount to be deducted from his brokerage. The funds are invested through a systematic plan in UTI’s Retirement Benefit Pension Fund. The scheme is offered to advisors who are giving business to UTI on a continuous basis throughout the year. Such advisors are offered a comprehensive health insurance too. For older advisors, UTI offers insurance and medical cover for their entire family members.
UTI MF is planning to start another campaign to persuade more distributors to avail of this proposal. Currently only UTI MF and Franklin Templeton MF (Templeton India Pension) offer pension schemes in the mutual fund industry. “UTI has taken voluntary option from advisors for joining our retirement benefit pension plan. Around 400 advisors have already opted for it,” said an official from UTI.
It remains to be seen whether other fund houses will start offering such schemes to their distributors.
