Non-bank MFs forge special ties with distributors to gain market share

Such tie-ups to help fund houses compete with MFs that have their own bank channels

Non-bank fund houses are looking to enter into special arrangements with distributors to expand their asset base. Essel Mutual Fund (MF) recently gave a token stake in its business to NJ India Invest, the country’s largest distributor in terms of commission.

Reliance MF and Vakrangee entered into a tie-up in July to distribute the former's mutual fund products in under-served areas.

According to experts, in an industry dominated by fund houses backed by large banks, such tie-ups can help in improving the competitive landscape. 

More than 60 per cent of the assets managed by the top five fund houses belong