How To Become A Mutual Fund Agent In India: The Job of a Mutual Funds Agent in India is a popular and reputable career option. It is an especially lucrative career option for those who wish to make a career in this financial sector and the investment market. The best part about this career option is you don’t need to have a specific qualification or age eligibility to become a mutual funds agent. You can start and build your business whenever you decide to.
If you are interested in becoming a mutual funds agent, you shall find all about the steps to become one. But first, for the uninitiated, let’s start by talking about who is a mutual funds agent and what do they exactly do
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- Who is a Mutual Funds Agent? What does a Mutual Funds Agent do?
- How do Mutual Funds Agents earn their income?
- Steps to Become a Mutual Fund agent?
Mutual funds agent or advisor is a qualified professional who helps investors in matters related to mutual funds such as suggesting the best mutual funds schemes, making investments on their behalf or managing their mutual fund investments.
The job and aim of a mutual funds advisor are to help preserve the wealth of their clients and reach their financial goals by investing in the best mutual funds schemes. To this end, they are required to keep a track of a variety of mutual funds schemes with different investment objectives and align the best and most suitable schemes with the financial goals of the investors. For the fulfilment of their role, they offer tailored advice to their clients after understanding their needs and financial goals, evaluating their risk appetite, analysing their investment options etc.
The income of a mutual fund agent comes through commission on their client’s investment. They may get the commission directly from the fund house or through the distributors selling the schemes of the house. Mutual funds agents enter into agreements with the distributors who pay them a commission that is agreed upon based on the number of mutual funds schemes sold by them.
You can become a mutual fund agent by following the below-mentioned steps:
- Passing the NISM certification exam
- Getting your AMFI registration done
- Getting empanelled with different mutual funds companies
Step 1: Passing the NISM certification exam
To become a mutual funds agent/advisor/distributor, it is a mandatory requirement to qualify for the National Institute of Securities Market (NISM) examination to become a certified mutual funds distributor. The Examination is called NISM-Series-V-A: Mutual Funds Distributor Certification Examination and it tests the fundamental knowledge of the personnel related to the subject.
Mutual Fund distributors play an important role as intermediaries investing on behalf of those who avail their services, they also play an important role in promoting the sales of Mutual Funds and therefore their ways of doing business and quality have an impact on both individuals and the market in significant ways. Therefore, it is mandatory to qualify for this certification which is aimed at ensuring the highest standards of knowledge, attitude and ethics in the interest of all.
The NISM certification examination has no eligibility requirements as of age or education. Application for the same can be made online. Once passed, the certification has a validity period of three years.
Step 2: Getting the AMFI registration and ARN number
Further, all NISM certified mutual funds intermediaries who engage in marketing and selling of Mutual funds are required to be registered with the Association of Mutual Funds in India (AMFI) after passing the NISM certification test. Post their registration, mutual fund advisors obtain an AMFI Registration Number (ARN) – a unique identification number that recognises the individual distributor as an AMFI Registered Mutual Funds Distributor (ARMFD). It is a unique identification number of an individual mutual fund distributor/advisor. Along with ARN, mutual funds advisors also get an Employee Unique Identity Number (EUIN). Both ARN and EUIN can be obtained online via an application on the AMFI website.
Step 3: Empanelling with Mutual Funds Companies
After the NISM accreditation and obtaining the ARN number, one final step remains before you start your practice, which is to empanel with all the mutual funds’ companies to begin selling their mutual funds schemes. This can be done directly with the mutual funds’ companies or via online mutual funds distribution platforms in India.
After these three steps, you become a full-fledged and practising Mutual Fund Agent Advisor and you can start your career in helping your client achieve their financial goals and securing your own as you do it.