The financial services segment is witnessing myriad changes in ways that are more dramatic than one would have foreseen a few years ago. From smart technologies to collaborative software and more, financial institutions are remodeling or adopting newer ways to reach out to customers. Taking a leaf from the evolving financial ecosystem is the Mutual Fund (MF) industry which is working in tandem with the changing investor needs and market scenarios.
For instance, the distribution channel of the Mutual Fund industry is arguable of utmost importance and influence. Look at the conventional MF Distribution process. It is designed in a way that leads to lot of paperwork, cumbersome, and error-prone manual processes with the high cost to the industry. The traditional sales/distribution model wasn’t helping AMCs to drive AUM growth or reduction in TER and led to additional costs and inefficiencies in the system.
Some of the drawbacks of the traditional MF distribution channel are,
It’s vital for any distribution channel to devote time for acquiring new clients, retain them to stay invested, reduce their operational cost, and upgrade themselves with evolving market dynamics. AMCs are also in need of distribution channels that can cater to new markets, especially in B30 locations.
Through extensive efforts and in line with the vision of market regulator, to significantly improve retail penetration and drive digitization, digital distribution platforms are now empowering the Mutual Fund industry.
BSE StAR MF platform has been instrumental in driving this change and providing an effective medium to improve efficiency and reduce costs, and pass on these benefits to investors
How BSE StAR MF Digital distribution had positive impact:
BSE has been quoted as “UPI of MF Industry” as it’s a pioneer in digital distribution and instrumental in driving online MF Distribution infrastructure for Distributors/Advisors, Investors, Fund Houses, and other industry participants.
Clearly, technology has played an important role in the evolution of the MF industry and has minimized inherent risks that led to improved financial inclusion and boost in the industry’s penetration.
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