Now the time has come for the mutual fund industry to address the problem of size and its impact on the investors.

Mutual fund is comparatively a new entity in the financial market. Mutual funds were introduced in India 40 years ago as an investment vehicle when UTI launched US-64-India's first and one of the most popular mutual fund schemes. However, as a financial services industry, mutual funds have had a short history of only 10 years as Morgan Stanley, Kothari Pioneer Mutual Fund and Taurus Mutual Fund launched their maiden schemes in 1993-94. Since then, a lot of transformation has taken place and now mutual funds are offering a wide range of new products to their investors.

In the last 10 years, the industry has developed manifold and is now managing assets worth Rs. 1,53,000 cr. The mutual fund industry has now reached the crossroads and is facing fierce competition from other investment avenues available to the investors, such as National Savings Certificates, Indira Vikas Patra, Kisan Vikas Patra, Public Provident Fund and the bank deposits.

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