The Association of Mutual Funds in India (AMFI) has released its AMFI-BCG vision document stating its target for the next decade. As per the document, the mutual fund sector is targeting an asset under management (AUM) of Rs 10 lakh crore by 2030.
The document also revealed that the AMFI is looking to increase mutual fund investor base by four folds to touch 10 crore. The document was released in Mumbai and Ajay Tyagi, the chairman of the Securities and Exchange Board of India, was present.
The AMFI is looking to leverage the wide network of post offices and banks across the country to pull the general public to invest in mutual funds. Strengthening digital and direct channels would be vital in adding eight crore new investors.
The Indian mutual fund industry is still not a popular investment option in the country. The industry has so far failed to penetrate, and hence, there are hardly two crore mutual fund investors in India.
It is now imperative for the segments within the mutual fund sector to work on the grey areas and fix the missing points at the earliest to attract a broad investor base. They need to ensure that they are successful in doing their part in achieving the target.
It looks like being transparent helps to increase the investor base. The AMFI began disclosing SIP contributions every month in April 2016, and as per the facts of AMFI-CRISIL, the SIP investment has so far seen an increase of 23% since then.
The number of SIP accounts has nearly tripled since April 2016. It was 10 million in April 2016, and now, it is breaching the mark of 27.3 million. Also, the individual contribution has increased from Rs 44,000 crore in FY 2016-17 to Rs 93,000 crore in FY 2018-19.
The AMFI is running an awareness campaign by the name ‘Mutual Funds Sahi Hai’, and it has so far been successful in encouraging individuals to consider mutual funds as a viable option. The industry needs to come up with more such campaigns.
The mutual fund industry is successful in adding 44.2 million portfolios between 2014 March 2014 and 2019 June. Most of which are from individual investors who recorded a compound annual growth rate (CAGR) of 15.5% in the span.
Engineer by qualification, financial writer by choice. I am always open to learning new things.