The mutual fund industry is mostly concentrated among high networth investments. There is a need for the industry to train its people to take the industry to rural and suburban investors.

The Indian Mutual Fund (MF) industry has matured in terms of Assets Under Management (AUM), number of Asset Management Companies (AMCs), number and variety of products and the participation level in the capital market.

In spite of its rapid growth in the last few years, it is apparent from Table 1, which gives the current status of the Indian MF industry, that this industry has still a long way to go in terms of market presence and market penetration. It shows that AUM by Indian MFs is only 10% of GDP as compared to 74% in the US, 100% in Australia and 45% in Brazil. Further, retail participation in India in this market is 42% as compared to 87% in the US. AUM by MFs is only 14% of total bank deposits.

The reason behind the low rate of growth in AUM as compared to some other countries is evident from the pie chart in Table 2. It shows that MFs in India have concentrated on the large cities and Class 1 towns and these constitute around 77% of total investors. A large part of the Indian economy has not been tapped yet and there has been lack of penetration by the MFs in the rural and semi-urban areas.

Table 3 gives the various product innovations that have taken place in the Indian MF industry and indicates that novel products have been introduced quite late in India. Gold funds are only around six months old and there are currently only three such funds in India. Real estate funds are also of recent origin and there are not Fund of Funds.

Portfolio Organizer Magazine , Indian Mutual Fund Industry Mutual Fund, MF, Assets Under Management, AUM, Companies, Asset Management Companies, AMCs, Gross Domestic Products, GDP, Net Asset Value, NAV, Fast Moving Consumer Goods, FMCG, Financial sector.