AMFI extends ARN fee waiver period for the second time till March 2014 in order to attract new distributors.
AMFI has further extended the ARN fee waiver period till March 2014. AMFI started issuing ARN free of cost to individuals and new cadre of distributors (for those who register for the first time) from February 2013 in a bid to expand the distribution force. This is the second time AMFI has extended the fee waiver period.
Industry officials say that the distribution community had recommended AMFI to extend the ARN fee waiver time. AMFI is also trying to enroll 100 new distributors from each of the 200 districts where it is conducting District Adoption Program (DAP), an investor awareness initiative, with AMCs. Large AMCs like Reliance, HDFC, UTI and SBI are trying to enroll new cadre of distributors.
The fee waiver strategy seems to have paid off going by the new ARN registrations with AMFI. As per information available on AMFI's website, around 1200 people have applied with AMFI for an ARN license till March 2013. Around 200 applications under the new cadre of distributor category were received till March 2013. However, industry officials are of the view that these numbers aren’t encouraging.
“The industry had demanded that the fee waiver period should be extended. Fee waiver is just one of the methods to expand the industry. More needs to be done by AMCs, AMFI and SEBI to grow the industry. There have been new ARN registrations at AMFI after the fee was waived but that is not enough. 1200 distributors are not adequate for 44 AMCs,” says Nilesh Sathe, Director & CEO, LIC Nomura Mutual Fund.
New cadre of distributors include intermediaries engaged in distribution of financial products e.g. insurance agent, FD agent, national savings scheme products, PPF, etc. registered with any other financial services regulator and business correspondents appointed by banks.
ARN licenses are valid up to three years.
