Jio Payments Bank gets mutual funds distribution licence from Amfi

Jio Payments Bank, a subsidiary of Jio Financial Services, has secured a mutual fund distribution licence from the Association of Mutual Funds in India (Amfi). The Category 1 Execution-only Platform (EOP) licence allows distribution of the direct plan of mutual fund (MF) schemes.

Category 1 EOPs receive transaction charges from fund houses. The fee is capped at Rs 2 per transaction.

Currently, there are 15 Category 1 EOPs registered with Amfi.

The direct plan distribution business is dominated by stock brokers like Groww and Zerodha.

In August, Jio Financial announced that it has increased its stake in Jio Payments Bank from 78.95 per cent to 82.17 per cent by investing Rs 68 crore.

Separately, Jio Financial Services has also formed a joint venture with United States-based BlackRock to set up a wealth management and broking business. Wealth management also involves distribution of financial products.

The move is part of Jio Financial Services' plan to broaden its presence in the financial services industry, including asset and wealth management.

Last week, its asset management joint venture with BlackRock received in-principle approval from the Securities and Exchange Board of India (Sebi) to foray into the mutual fund business. The regulator grants final approval after the company meets all the conditions, and this generally takes around a year.

Last month, the company announced that Jio Financial and BlackRock Advisors Singapore have incorporated a joint venture company named 'Jio BlackRock Investment Advisers' to “carry on, inter alia, the primary business of investment advisory services subject to regulatory approvals.”