Jio Blackrock Asset Management Company has been able to achieve an investor base of 1 million within seven months of the launch of its debut mutual fund and 25% of it are first time mutual fund investors, said KV Kamath, chairman of the board of directors of Jio Financial Services in a panel discussion on Tuesday.
According to him this was unbelievable to him and shows that the young India is not hesitating to use technology. “A large part of our business is direct, we tested this approach and it has clearly proven to be right,” he said.
In December quarter, the fund’s average assets under management were Rs 13,757.46 crore. Rob Goldstein, chief operating officer of BlackRock noted that in India people are paying high prices and distribution costs. He added that a lot of the use of technology in India for consumer experience is highly personalized but with regards to financial services and asset management, it hasn’t caught up in the same way.
Kamath expects mutual fund investors to more than double in the next five years. He said: “My experience in banking shows that if the country is growing at 10%, financial services grows 15% and there also needs to be reallocation of money from money lying in savings account at very low interest rates into investment accounts which give you higher rates. Banks will have to reinvent.”
Goldstein believes the same. “If India is going to become third largest economy in the world, we will agree that capital markets need to grow and mutual fund industry needs to be a lot bigger than under a trillion dollars today,” he said.
