Tech Innovation & “TRUST” Building steps will put Mutual Fund Industry in high growth path
By : By : PARTHA ROY
Indian Mutual Fund Industry is growing at a rapid pace and has potential to grow at higher growth trajectory if proper Trust building regulatory mechanism are in place.
15th Mutual Fund Summit with emphasis on Asset and Wealth Management was organised by Indian Chamber of Commerce ( ICC ) on 9th March 2024 in Kolkata to deliberate on evolving practices in dynamic & evolving Asset and Wealth Management market .
The session was attended by Amarjeet Singh, Whole Time Member, SEBI; Venkat Nageshwar Chalasani, Chief Executive, AMFI; Brij Bhushan Agarwal, Vice President, Indian Chamber of Commerce; Kailash Kulkarni, CEO, HSBC Mutual Fund, India; Hemant Daga, Co-Founder & CEO, Neo Asset Management; and Atanu Sen, Chairman, ICC National Expert Committee- BFSI, and large no.of professionals from Mutual Fund Industry.
The industry experienced a significant surge in Assets Under Management (AUM), reaching approximately ₹ 52.9 lakh crore in January 2024. Systematic Investment Plans (SIPs) playing major role in increasing retail market expansion. In evolving financial scape, technology is playing a transformative role in expansion of the industry . Digitalisation involving technology like artificial intelligence and machine learning enhancing customer experience and streamlining investment processes.
Personal Investment planning getting tailor made due to advancement in technology.
Securities and Exchange Board of India (SEBI) is introducing frameworks like “MF Lite” for passive funds to reduce compliance burdens to promote market confidence and market expansion . Regulatory measures like scheme categorisation, rationalisation and the introduction of Total Expense Ratio (TER) aim to enhance transparency and protect investor interests.
From March 2020 to January 2024, number of unique investors in the mutual fund industry grown from approximately 2.92 crores to nearly 5 crores, at annual growth rate of approx.15%. West Bengal, mainly Kolkata played significant role in this growth.. Kolkata ‘s AUM contribution ranks among the top five cities, comprising 3.6% of the total. Kolkata and West Bengal, have potential to increase their market share in mutual fund investment contribution.
The mutual fund industry has experienced remarkable expansion, witnessing assets under management (AUM) increased to approx.₹54 lakh crores by February 2024, a substantial rise from ₹ 10,00,000 crores in 2014.
In a dynamic and evolving mutual fund Industry, Regulators have important role to play to promote investers security and in building investers Trust.
Collaboration between multiple stakeholders and regulators will be key to ensuring sustainable growth and investor protection
