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If there is one organization in India that has played a stellar role, and continues to play a stellar role in educating investors about the nuances of mutual fund, it is the Association of Mutual Funds of India. Popularly known as AMFI, it is just an association to further the cause of mutual funds and ensure that mutual funds penetrate better in India.
The AMFI handles the daily NAV dissemination of all funds as well as dissemination of the monthly flows data of various categories of mutual funds. It also handles the ARN registrations for individuals to ensure that in the entire mutual fund selling process, the integrity, transparency and investors interest is sustained.
Indian mutual fund industry has grown by leaps and bounds in the last few years. As of November, the Indian mutual fund segment has assets under management of Rs.3.80 trillion or close to $500 billion. There are a total of 9.78 crore mutual fund folios in India of which SIP folios itself are close to 5 crore. MFs have emerged as an important intermediary.
When it comes to investing, there are several cases wherein the channelization of savings into mutual funds does not happen properly. That is because either the investor’s money is misused or the product is mis-sold to the end customer, defeating the purpose of investor education. For such investor disputes or queries, the AMFI helps protect investor interest.
AMFI is a non-profit association and has been existence since 1995. The sole purpose of AMFI is to work for the benefit of investors by offering them transparency in mutual fund practices. AMFI plays a key role in restoring the faith of the investors in case they face any issues in the Indian Mutual Fund Industry, including key disputes. AMFI works under the guidance of SEBI.
The office bearers of AMFI are mostly the senior representatives of the mutual fund industry in India. All advisors, agent and trustees must be registered with AMFI.
AMFI was set up with some very broad objectives on hand. Here is a summary.
Here is what the AMFI will ensure among the mutual fund segment in India.
Intermediaries are the backbone of the mutual fund industry in India. They play a significant role in establishing and nurturing the mutual fund cult in India. To ensure that individual agents, brokers and other intermediaries carry out MF selling with ethics and transparency, the AMFI ARN registration is mandatory in India. Here is what you need to know about the AMFI-ARN registration.
If a fund manager, broker, agent wants to deal with mutual fund selling, they should get a permit from AMFI and the association will provide them with a unique AMFI registration number or ARN. The AMFI ARN is a license that the entity is qualified to sell mutual funds. Nobody is allowed to sell or recommend mutual funds to investors without the ARN licence.
There are 3 scenarios wherein the ARN license can be withdrawn by AMFI.
Brokers or agents who are registered with an AMFI ARN number can renew their ARN online using online or offline method. Here is how the online renewal happens in following steps.
Brokers or agents who are registered with an AMFI ARN number can renew their ARN offline in case they are not able to do it online. Here are the key steps.
Step 1: Visit the AMFI portal and login with your credentials
Step 2: The user ID is your ARN number, and the password is sent by email by the CAMS
Step 3: AMFI fills your personal details by getting it from NISM
Step 4: After you get the certificate, pay the fee online
Step 5: Your ARN gets renewed instantly
The Association of Mutual Funds in India (AMFI), unlike popular believe, is not a self-regulatory organization. It is more like a watchdog that ensures that the mutual fund selling happens in a transparent manner without indulging in mis-selling.
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