Mumbai: A.P. Kurian, chairman of Association of Mutual Funds in India, or Amfi, an industry body, spoke on the new NSE mutual fund trading platform. Edited excerpts:
Is this a good move?
Path-breaking. Nearly 200,000 terminals across some 1,500 locations across India are now available for buying and selling mutual funds (MFs). The purpose is obviously to extend reach. Today, just as how people go to buy shares on the exchanges—they call up the broker and instruct him/her to buy any scrip—a similar way of trading will be possible for MFs. Since demat accounts are already KYC-compliant, you don’t have to do KYC (know your customer) again.
Positive outlook:A.P. Kurian says there is adequate space for both the Amfi platform and the new stock exchange platform because of India’s large population that can be tapped. Abhijit Bhatlekar/Mint
Will the existing distribution community be adversely affected?
When MF distribution started many years ago, there were only independent, individual distributors. Then came banks, followed by distribution companies. Still, the independent distributor survived because they didn’t supplant one another. The size of the country is such that everyone can survive. It’s like one restaurant is there in a locality and then some years later, another restaurant comes in.
There’s a feeling that the new stock exchange platform will cannibalize the Amfi platform and that the latter has now taken a back seat. True?
The stock exchange platform caters to registered stock brokers. But there are still around 100,000 Amfi registration number (ARN) holders who need to be serviced. The stock exchange becomes a trading platform for the broker community, while the Amfi platform becomes a trading platform for the ARN distributors. These are two segments and there is adequate space for both the platforms. India is a vast country with a large population that can be tapped. I am confident that the Amfi platform will see the light of the day.
Would BSE and NSE now be a part of the Amfi platform given their new equation?
That situation is being discussed and looked into now. We will have to wait and see what happens.
When will the Amfi platform see the light of the day?
Wait and watch.