AMFI has done away with the 10 year experience criteria required for insurance agents and bank correspondents to enroll as new cadre of distributors.
In a relief to aspiring distributors, AMFI is said to have done away with the 10 year experience criteria required under the new cadre of distributors for insurance agent, FD agent, national savings scheme products, PPF agents. However, the first category of distributors who are retired teachers, government officials and retired bank officers will still require 10 years of experience.
“AMFI has created a second category of distributors who will not require 10 years of experience. This will hopefully benefit the industry in attracting more distributors,” said a sales head of a public sector AMC.
NISM has developed a one day CPE (NISM-Series-V-B: Mutual Fund Foundation Certification Examination) for new cadre of distributors.
“AMFI should also allow the employees of IFAs who have 10 years of experience to enroll under the new category of distributors created by SEBI. This move can also bring new distributors in the industry,” suggests a sales head of a private sector fund house.
Large fund houses are already in the process of training their new cadre of distributors. “It is our main focus area at this juncture and we are targeting to add 10000 new distributors in a year’s time,” says Himanshu Vyapak, Deputy CEO, Reliance Mutual Fund.
Some AMCs are focusing on enrolling distributors from beyond top 15 cities since they have an incentive to earn extra TER from such locations.
UTI Mutual Fund is planning to add at least 5000 distributors under the new category of distributors. UTI is also funding the education cost of these distributors.
National distributors too are seriously looking at this new opportunity. “We are waiting for some clarity on the process and rules to empanel these distributors. We are definitely looking at enrolling new distributors under this category on our platform,” says Neeraj Choksi, Jt. Managing Director, NJ India.
Meanwhile, some AMCs are going slow on enrolling new cadre of distributors. “We are presently looking at reaching out to our existing distribution force. We do have an innovative plan to enroll the new cadre of distributors,” said Ajit Menon, EVP, DSP Black Rock Investment Managers.
Out of the 80,000 registered distributors with AMFI, roughly 50,000 are KYD compliant. In a bid to attract more distributors, AMFI has recently waived off ARN registration fee for all new distributors till June 30.
These new cadre of distributors will only be allowed to sell diversified equity schemes, fixed maturity plans (FMPs) and index schemes which have returns equal to or better than their scheme benchmark returns during each of the last three years, as specified by SEBI.
