Anil Ambani, Chairman of Reliance Group today, said the mutual fund industry is barely out of its teens and is poised to grow 10-fold in 5 years.
He urged SEBI Chairman Ajay Tyagi to simplify investment and advertisement norms for mutual funds. Ambani said investing in mutual funds must be as easy as buying smartphones on internet.
Ambani was addressing AMFI Mutual Fund Summit 2017 held in Mumbai today.
He further said only one in 25 Indians invests in mutual fund products at present, but the investor base can be expanded 10-fold to 60 crore in five years. “India’s mutual fund industry is today poised for its Jan Dhan moment,” Ambani said.
Explaining with figures, Ambani said while 9 out of 10 Indians have a mobile connection and 3 out of 10 have a smartphone, only 1 in 25 Indians has an investment in a mutual fund.
“The comparisons in a global context are even more staggering. There are as many as 58 asset management companies in the world which manage more money than India’s entire MF industry put together,” said Ambani
Reliance Group firm Reliance Capital also runs Reliance Mutual Fund which currently manages Rs 3.58 lakh crore AUM.
“Going forward, we in the industry need to work closely with you (Sebi) to further simplify the on-boarding process for new investors,” Ambani said, while suggesting some steps for the the next 100 days. His suggestions included making MF investment even simpler, allowing anyone with a legitimate bank account to invest in financial products since their bank KYC is already in place and ensuring better utilisation of technology to improve penetration and facilitate faster transactions. He also urged SEBI to simplify advertising norms to help communicate the value proposition of mutual funds better.
“These steps will bring in a new class of investors to the mutual fund industry,” he added. Ambani urged the industry to grow its individual investor folios from 6 crore currently to 60 crore in five years when India will celebrate 75 years of Independence.
He termed the GST (Goods and Services Tax) as India’s ‘economic freedom’ while noting that it would make “a borderless world of 1.3 billion people — producers and consumers engaged in a seamless exchange of goods and services, skill sets and capital, labour and ideas”. He said the world has seen nothing like this before as “in less than 48 hours, India will emerge as the biggest free and democratic market in the history of humankind”.
“In tandem with its policy precursor — demonetisation — GST will forever change the ground rules of doing any kind of trade, commerce or business in India,” he added.[“Source-moneycontrol”]