The number of KYD compliant distributors has gone up from 40,000 to 50,000.
With more incentive for AMCs and distributors to procure applications from beyond top 15 cities, existing and new distributors are taking a shine to mutual funds. When the KYD rules were first introduced, out of the 80,000 odd ARN holders registered with AMFI, only 40,000 were KYD compliant. Now, the number of KYD compliant distributors has grown to 50,000 plus.
The 10,000 addition in KYD numbers consist of existing and new distributors. According to AMFI, 1000 new distributors have completed their KYD process during Oct- December 2012 alone.
“We have seen entry of many new distributors in the last three months. Distributors have become active now and we will see the KYD number increasing after the new cadre of distributors joining the industry,” says V Ramesh, Deputy CEO, AMFI.
AMFI had in 2010 asked all fund houses in the country to comply with the all new 'Know-Your-Distributor (KYD)' norms before the grant or renewal of registration of distributors. The new KYD norms require distributors to go through a stringent verification process that would look into the past record of the distributors to minimize the risk of mis-selling.
In an effort to attract new distributors, AMFI has waived off the ARN registration fee for five months. Recently, AMFI had also slashed the ARN registration and renewal fee for all categories of distributors.
Do you think ARN fee waiver will attract more distributors in the industry? Let us know.
