Mutual funds have been getting popular among people especially in big cities. But Bihar MFD Sandeep Chourasia from Samastipur is on a mission to bring in rural population of India to the mutual fund fold.
Let us look at his story in his own words.
In November 2020, I came across an article on Cafemutual titled, "How this Darbhanga MFD conducted a physical SIP drive" and was amazed as to how 180 SIPs could be initiated in a single day.
I used to read Cafemutual even before becoming a MFD to become a better mutual fund investor but that article marked a new beginning for me. I soon applied for an ARN and started my distribution journey.
Almost a year later, I have successfully conducted my first SIP drive and my AUM has crossed the 1-crore mark. What makes these milestones all the more special is that all my clients are from villages near Samastipur, a small town located 85 km North of Patna.
I conducted the SIP drive on December 20 and 45 investors participated in it. A total of 136 SIPs were registered amounting to Rs.2.72 lakh.
The success has come on the back of a lot of struggle. Rural investors are very apprehensive about new products. Every time I have to face a barrage of questions and some of them aren't easy to answer.
And the hardest of these questions is — Guarantee kya hai? I tell them that mutual funds are regulated by a government body, SEBI and that there's unmatched transparency. Sometimes it works and sometimes it doesn't.
The digital-first approach of mutual funds also becomes a hurdle. Clients in rural areas want everything in written, which is not easy to provide. Digital client onboarding is also a challenge as they fear sharing OTP. Facilitating investments through physical forms is also an inconvenience as none of the AMCs have offices nearby.
However, people have now started to trust me. My existing clients act as a proof of my integrity.
The biggest challenge in working in a rural area is limited prospects. It's easy to explain and convince young people but a large section of them do not have much income. Older people have money but they refuse to try something new.
I sold life insurance for almost 10 years and have a large client base. But despite having years of relationship, 90% of the clients said no when I pitched mutual funds to them.
However, the trend is changing. The positive experience of friends and relatives in mutual funds is kindling interest of others. Young investors are anyway familiar with markets these days.
I believe that mutual funds will catch up here soon. This is why I never considered moving out to an urban centre. There are two factors that work in my favour here — I have a good grasp of what people of Samastipur want and I do not have any competition. The commission is also higher here as the area falls in B-30 category.
I look forward to conducting many more SIP drives in the near future.
