The number of distributors selling mutual funds has increased by nearly 8 per cent since the ban on entry load
Mumbai: The mutual fund distribution business is drawing more financial advisors into its fold, despite perceptions of it being hurt by the ban on entry load.
In the one year since the ban came into effect on August 1, 2009, a total of 5,637 new distributors got themselves registered with AMFI. The total number of distributors holding AMFI Registration Numbers (ARNs) had increased to 81,219 in August 2010 from 75,414 at the end of July 2009. In September 2010, the total ARN holders increased further to 81,287, up 7.78 per cent from July 2009, according to Computer Age Management Services (CAMS) data.
Another proof of distribution business being in good shape is the increase ARN holders who are active. The number of active distributors in August 2010 was 76,887, up 13.58 per cent from 67,689 in July 2009.
The total number of expired ARNs is also lower now than just before the abolition of entry load came into effect. The number of ARNs expired in the month of September 2010 was 4,140 against 7,725 in July 2009.
In an interview with Cafemutual earlier, Hemant Rustagi, CEO of Wiseinvest Advisors, had said “I don’t think entry load ban has impacted the business of serious players like us. It has impacted those who were not following any particular strategy or who were just relying on selling mutual fund products rather than providing solutions to long-term needs of investors. Now, we can see more and more qualified people are becoming financial planners.”
Source: http://www.cafemutual.com/News/InnerNews.aspx?srno=98&MainType=New&NewsType=Industry&id=21
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