Indian Economy News

The MF industry is expected to be one-third of the banking industry by 2030: Mr. Nimesh Shah

  • IBEF
  • October 31, 2023

According to ICICI Prudential Mutual Fund's managing director Mr. Nimesh Shah, the Mutual Funds (MF) business will account for one-third of the banking industry by 2030, and the industry will grow to more than Rs. 100 trillion (US$ 120.10 billion) in the next ten years.

Mr. Shah stated at a panel discussion at the Business Standard BFSI Insight Summit 2023 in Mumbai that digital technology has helped the MF market flourish in a unique way. The reach of MF firms has expanded to approximately 200 locations across the country. He said, “We will be present if we observe appropriate bank deposits. Numerous financial literacy initiatives are underway, and over the next ten years, the business might expand by over Rs. 100 trillion (US$ 120.10 billion)”.

Managing director of Kotak Mahindra Asset Management, Mr. Nilesh Shah, spoke during the event about the need to increase awareness in order to reach new customers. He said, “We need distributors to take MFs to the hinterland. We also need a level playing field in terms of transparency and disclosures”.

Aditya Birla Sun Life MF, Mr. A Balasubramanian said, “China took 20 years to bring telecom penetration and though India started late, we took only 10 years to reach our target. The same goes for mutual funds, the next five years will bring faster growth”.

HDFC MF's managing director and CEO, Mr. Navneet Munot said that while penetration has improved over time, the sector has only touched the tip of the iceberg. The country has only 40 million distinct customers. He also stated that the "Mutual Funds Sahi Hai Campaign" launched by AMFI and backed by MFs has aided the industry's growth. He continued,” We hit a J curve after a lot of hard work. The sachet moment of SIP will bring new customers”.

Managing Director and Chief Executive Officer of Edelweiss MF, Ms. Radhika Gupta said,” We should give ourselves credit. The industry coming together for the campaign "MF Sahi Hai "deserves a round of applause. The fact that we have this kind of retail SIP book is surprising for many outsiders”.

The Chief Executive Officer of Mirae Mutual Fund Mirae Asset MF, Mr. Swarup Mohanty said, ” Every industry needs an inflexion point. And for us, that started with demonetisation, when there was a shift from fixed passage to a financial asset. That got catapulted with COVID-19, and today, when you look at the country, the country is very different because it has reached that very instrumental threshold of $2000 per capita. And that's where people start earning money, and when you earn money, the first instinct is to fulfil your desires which people are going through consumerism but when you invest somewhere hoping to earn money, that process has started.”

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.