As an MFD, one question comes up every single year—especially during review meetings and tax discussions: “How did my client’s portfolio perform this financial year?” Earlier, answering this wasn’t as simple as it sounds. You could see current values and transactions, but understanding year-on-year performance often meant juggling multiple reports or doing manual calculations. That’s where top mutual fund software in India , like Wealth Elite, brings a major improvement. What is a Financial Year–Wise Performance Report? A Financial Year–Wise (FY) Performance Report gives you a clear snapshot of an investor’s portfolio for each financial year. It shows just two critical numbers for every year: ● Opening Balance – Portfolio value at the start of the financial year ● Closing Balance – Portfolio value at the end of the financial year This simple structure answers the most important performance question directly: How much did the portfolio grow (or decl...
With the digital explosion, most modern consumers have started using the internet to research Mutual Fund Distributors and evaluate, the person they want to trust with their money. Investing someone’s hard-earned money is a big challenge for MFDs, they have to ensure that their customer must grow their wealth over a period of time. This blog will discuss why an Indian MFD requires good mutual fund software to improve its AUM growth and increase its investors’ wealth.
- Mindset of Indian MFDs
Indian MFDs despite all the required knowledge lays one step behind because they are not able to adopt technology into their business. Some MFDs fear incorporating technology into their business and rely on manual operations. Others found tech investment to be a waste of money. In this digital age, they must automate their business with high-quality mutual fund software in India. MFDs need to understand the importance of technology as an unsystematic risk, where investors cannot be rewarded for not diversifying their portfolios, you will have to bear the loss, and similarly, MFDs will have to bear the loss of not getting tech-upgrade.
- Competition from peer mutual fund distributors
As per the latest SEBI reports (28 February 2019), there is a total of 1.24 lakh MFDs in India. Later AMFI published the statistics on December 2021 and reported 1.18 lakh individual MFDs. Considering a population size of 1.35 billion, there is roughly one MFD for every 11,400 people in India. However, the investing crowd in India is way smaller, which increases the challenge of rising competition.
Again technology can rescue. MFDs are required to invest a considerable chunk of their earnings into technology. Technology helps them in becoming more digitally presentable, especially in front of Gen-Z.
- Competition from online distributors like Zerodha, ET Money, and large distributors like banks
As per a survey conducted by Cafemutual, a large number of MFDs in India believe that competition from online distributors like Paytm, Zerodha, and ET Money, and large distributors like banks and NDs is their biggest challenge that is hurdling their business growth.
To overcome this challenge, MFDs also need to tighten their relationship with technology and upgrade themselves with the ongoing process of digitalization. It is important to understand that these big online platforms also have their drawbacks, e.g. there is no personal touch, an investor is generally handled by a chatbot or call recordings initially. Moreover, an investor might broadly receive a tech-related solution, but no financial solution or advisory. An MFD is the single most entity that can fill this gap through efficient usage of technology.
- Competition from direct investors
Despite the strong awareness campaigns by AMFI “Mutual funds Sahi hai”, which advocates mutual funds as the ‘right choice’ for retail investors. There is an acute rise in direct retail investments. Investors are not ready to understand the inherent benefits of investing in mutual funds in the form of liquidity and diversification, coupled with the potential to generate high equity-driven returns. It is evident that mutual funds are more optimal investment options than other traditional options including bank deposits, gold, pension schemes, etc.
The challenge for an MFD is to switch this audience from undisciplined and risky direct investments to systematic investment plans. For that, an MFD can link the goals and future targets of investors with their periodical investments and keep their clients engaged by continuously revising their portfolios, which a good MF software can help by automating the overall process.
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