Mutual fund investment platform Paytm Money is planning to launch ‘Paytm Switch’ in 10-15 days to allow users switch from regular mutual funds to direct mutual funds from banks, asset management companies (AMC), distributors, stock brokers to Paytm Money. The move would help the company increase its market share in direct mutual fund subscriptions from current 40 per cent to up to 50 per cent in the six-month period, PTI reported quoting Pravin Jadhav, whole-time director, Paytm Money. Regular mutual funds wherein commission is charged by the seller have 85 per cent of the market share vis-a-vis around 15 per cent held by direct mutual funds, he said.
The direct mutual funds market share will likely grow to 25 per cent in two years, according to Jadhav even as Paytm Money launched new fund offers (NFOs) of mutual funds. Users can now invest in NFOs from all 40 AMCs in India. Launched in September 2018, Paytm Money claimed of having more than 30 lakh users.
The company had also claimed last month that it is the single largest contributor of new SIP registrations for the mutual funds industry and gets more than 5,000 new registrations per day. In June, Paytm Money had partnered with independent investment research firm Morningstar’s India subsidiary Morningstar Investment Adviser India to offer ‘Morningstar Investment Packs’ to its users and supported by Paytm Money’s ‘risk suitability assessment’ to offer customers (investors) right ‘pack’ based on their individual risk profiles.
“One of the things where Paytm Money may have some advantage in mutual funds is the familiarity of the app with its other platforms including Paytm and its payments bank. So people are very familiar with how to use Paytm and so they are more likely to opt for their other services like mutual funds. So the overall design principle and user experience are seamless. Although this may be a soft indicator, it can give an added advantage to Paytm Money, “Arnav Gupta, an analyst focusing on finance and retail at Forrester had told Financial Express Online earlier.
The mutual fund industry in India grew nearly 4X in 10 years from Rs 6.64 trillion as on 31st May 2009 to Rs 25.94 trillion in assets under management as on 31st May 2019, as per the Association of Mutual Funds in India.
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Source: Financial Express