Eight Mumbai based distributors are developing a web investment portal for IFAs which will facilitates investments with their own ARN
Mumbai: A group of eight Mumbai based distributors under the umbrella of Next Advisors are set to launch a web investment platform by June end which will allow IFAs to execute investments with all fund houses. The transaction service is currently under testing. The portal could cut down a considerable time, cost and resources for IFAs. The transactions could be executed in minimal time without having distributor to physically submit application forms to RTAs and collect cheques from investors.
Once the platform is launched, these distributors will hire sales executives to promote it among IFAs across India. “It will cut down the cost and time for IFAs and facilitate ease of investment. Currently at least two days are required in a mutual fund transaction which will get reduced to a couple of minutes once a client IFA agreement is signed,” says Rajendra Bhatia of Arthashastra Financial Planners who is part of the eight member group.
Features
It will enable distributors to transact in multiple SIPs of different fund houses by obtaining a single SIP mandate from investors. Currently, investors are required to furnish a fresh SIP mandate for starting every new SIP. As of now, none of the existing softwares present in the market enables this service.
To do so, the distributors have to obtain a service level agreement (SLA) which is mandated by SEBI rule. This pact permits an IFA to transact through an AMC’s website.
An important feature to watch out in this portal is an option for investors to make a range of upfront commission to their distributors while buying a mutual fund. The investor’s bank account would be debited (investment amount + upfront commission) to that extent.
The portal will allow investments in mutual funds, insurance, stocks, corporate fixed deposits, and allow investors to execute a transaction via phone. Besides, it will also have tools like CRM and portfolio snapshot. In addition, the portal will provide access to fund rating reports from CRISIL, ICRA and Morningstar.
IFAs cannot transact on behalf of their clients unless investors share their internet banking credentials with their distributors. Distributors will have to obtain an agreement from investors. Investors can invest on their own based on the schemes recommended by an IFA after logging on to this portal.
