In a highly enlightening and engaging talk at the 1st Businessworld Mutual Fund Summit held at Mumbai earlier this month, Saugata Chatterjee, Sr. Zonal Business Head (West), Reliance Mutual Fund provided some invaluable advice on how IFA's (Independent Financial Advisors) could go about creating their next 100 Crores of AUM (Assets Under Management).
He also used the opportunity to launch the latest innovation from the Reliance Mutual Fund stable - the 'Simply Save' App. Over the years, Reliance Mutual Fund has carved out a reputation as being a frontrunner when it comes to the development of innovative systems and technologies to empower the distributor community and the Mutual Fund ecosystem, as a whole.
Chatterjee began by reaffirming his belief in the critical role of IFA's in the development of the Mutual Fund industry in the times to come. "I believe that the IFA business is firmly on the growth path, and will continue growing in leaps and bounds as we go ahead, come what may", he said.
Chatterjee also stated that SIP's and retail participation will play a key role in the journey that lies ahead. He also mentioned that falling interest rates are likely to force a larger portion of retail savings into Mutual Funds in the times to come.
He advised the IFA's present to embrace technology as a friend, rather than viewing it as an obstacle to growth, while citing examples of exponential growth in other industries in India (such as smartphones and e-commerce).
"In the last two years, there have been 20,000 new ARN holders who have entered the industry. On average, they are growing faster than the cumulative 90,000+ ARN holders", observed Chatterjee, while observing that the inclination of the newer ARN holders to embrace progressive system and technology as a possible reason for their faster growth. He also mentioned that the industry asset mix is very balanced at the moment. Debt, as a category, presents a huge opportunity for IFA's to scale up their AUM's from this point on, Chatterjee said.
According to Chatterjee, IFA's need leverage technology to gear themselves to serve the second generation of investors that they have been presently serving over the years. In order to do this effectively, there are disruptive trends in technology that IFA's need to embrace right away.
"We've only touched the tip of the iceberg when it comes to mobilizing household savings into Mutual Funds", said Chatterjee. He cited the example of Indore, which is a 6,000 Crore Mutual Fund market - but has bank deposits amounting to 80,000 Crores! This undoubtedly represents a massive opportunity for IFA's; however, in order to exploit this opportunity, a single window view of the client's finances is absolutely critical.
Chatterjee advised IFA's to aim to source 1 household per day for the next three years, with an average AUM of 7 Lacs, which he said was an extremely feasible medium term target.
He provided compelling arguments in favour of the Reliance Simply Save App, which could potentially lead to a huge boost in AUM for IFA's. IFA's could position this proposition as a 'savings tool' and a viable alternative to leaving money idle in savings accounts, rather than as an investment per se.
Chatterjee mentioned that with the help of the Simply Save App, an investor could redeem money at the click of a button, without the need for paperwork or for navigating a complex online portal. The 'Passbook' feature of the App provides clients with a convenient, single window view of his liquid savings and related transactions.
The Simply Save App also solves the problem of having to wait for one working day (T+1) to receive redemption proceeds in case of emergency cash requirements. "It gives the client an 'instant redemption' option for any amount up to Rs. 2 Lacs", announced Chatterjee, to which he received an appreciative round of applause from the audience.
Chatterjee concluded his talk with a short, inspiring video developed by Reliance Mutual Fund, which essentially positioned Financial Advisors as 'Prosperity Advisors' instead.
Presented by Reliance Mutual Fund, the content intensive and power packed 1st Businessworld Mutual Fund India Summit was attended by over 300 IFA's at Trident BKC Mumbai on 12th August.
_20241003152432_original_image_28.webp)
