The Indian mutual fund industry has witnessed unprecedented growth over the last 2-3 years. Around 32 fund companies are competing in the free market with new offers and are educating customers to cultivate the “invest” habit in them. More fund houses are expected to start services in India in this financial year.

The last 3 years have seen a large movement of resources from bank deposits to asset management company (AMC) accounts. The industry today has more than 3 crore mutual fund (MF) accounts with total assets under management (AUM) of approximately Rs. 4.5 lakh crores. Swelling systematic investment plan (SIP) accounts indicate the maturity of the market.

Although most of the investments have come from the top 8 locations, AMCs are clearly looking at expanding to Tier II and Tier III locations to increase the AUM as more customers are looking at MF investments as an alternative to bank deposits. This will put a lot of stress on the infrastructure of the AMCs and AMCs will look at technologies which can help them speed up deployment, manage customer/distributor expectations and offer 24x7 services at low cost.