An incentive of 30 to 35 basis points is being paid
for new SIP subscription in equity schemes to ensure regular inflows
Mumbai: Advisors have more reasons to promote systematic
investments. Not only is SIP a convenient way to save for investors, it makes
business sense for AMCs as they steady long term inflow. And in volatile market
conditions such as those prevailing now, they are valued even more highly. So,
it is not surprising that SIPs are getting even more aggressively promoted by
AMCs and advisors alike.
Industry sources tell us that most of the fund houses are offering
an incentive to the tune of 30 to 35 basis points for three to five years in
their flagship schemes in advance.
“All fund houses have such incentive plans. If investors redeem
early, we take it back from distributors. The upfront could be even possible
for a period of ten years. We are competing in the same market so every fund
house is offering it. It is more than the regular upfront and trail because of
the long term money,” says a marketing head of a top fund house.
There are currently 25.36 lakh active SIPs among Karvy clients
with 7.64 lakh new SIPs being registered in the last six months. Cafemutual
had earlier reported that fund houses are seeing increased SIP inflows.
