1. If you face an unexpected monetary loss or have a concern regarding a mutual fund, AMFI is your first stop. It is a non-profit government organisation and primary regulator under the purview ofSEBI
Mutual fund is still a comparatively untapped financial sector. Initially, there was a lot of ambiguity and myths around them, and people were reluctant to invest. Therefore, statutory bodies like SEBI and AMFI have a huge role in keeping investors informed.
2. Role of AMFI in investor awareness
The AMFI were instrumental in setting ethical and transparent regulations in the Indian mutual fund arena. In the last two decades, it has contributed immensely to protect the interests of investors as well as fund houses.
They make investments more accessible and transparent to attract more people. Hence, every fund house, advisers, trustees and agents (intermediaries) must register with AMFI, which you can find on the government website. It currently has 44 members, which includes 42 SEBI-registered Asset Management Companies. Their Ads explain the advantages of mutual funds without ignoring the risk factors, which says a lot about their transparency.
3. Objectives of AMFI
a. To outline ethical and uniform professional standards in every mutual fund operating under the association.
b. To encourage members and investors to maintain ethical business practices and regulations.
c. To get AMCs, agents, distributors, advisories and other bodies involved in the capital market or financial service fields to comply with their guidelines.
d. To network with SEBI and comply with their mutual fund regulations.
e. To represent the Finance Ministry, RBI, and SEBI on everything related to the industry.
f. To spread awareness across the country on safe mutual fund investments.
g. To distribute information on mutual fund sector and conduct research and workshops on various funds.
h. Keep a check on Code of Conduct of everyone included and take disciplinary action in case of rule violations.
i. Investors can approach AMFI to air their grievances and register complaints against a fund manager or a fund house.
j. Safeguards the interest of investors and asset management companies
4. AMFI Registration Number or ARN
AMFI Registration Number (ARN) is a unique number assigned to mutual fund agents, distributors, and brokers. Only those whom clear NISM Certification can get one. Also, if you are a senior citizen, passing the CPE (Continuing Professional Education) is mandatory for the same. Without this number, you cannot sell a mutual fund or even recommend one.
AMFI issues ARN ID card to companies and individuals engaged in mutual fund trading. Remember, NISM certificate is valid only for three years. It entails name of the AMC, a photo of the cardholder, ARN number, the address of the corporate and validity (three years). Therefore, it is easier for investors to cross-check.
5. Why Investors must be aware of ARN
Brokers, agents, and intermediaries play a key role in encouraging more investors to invest in mutual funds. To make sure that only qualified people sell funds to prospective investors, AMFI authorises only people or entities with ARN Number to sell mutual funds. All third-party agents must register and pass a qualification test to become AMFI-registered advisers.
These people are well-versed about the mutual fund types, market trends and the reasoning behind. Please do not entertain any entity without ARN when it comes to mutual fund investing. Always double-check the registration number before investing. However, if you wish to invest directly, always specify the ARN code of AMC, and not that of the distributor in the ‘direct’ box. You can also drop applications at Registrar & Transfer Agency like CAMS and Karvy with ARN of the fund house.
6. How to Register or Renew ARN
a. Online registration & renewal of ARN
i. For ARN registration or renewal, link your Aadhaar and registered mobile number
ii. In case, you have not submitted the Aadhar details, apply manually
iii. Pay the fee to register or renew ARN via online banking
iv. There is no need to submit your NISM passing certificate to register/renew as CAMS can import it directly from NISM
v. Once they verify the documents uploaded on AMFI portal, you get a new ARN license instantly
b. Steps to register/renew ARN offline
i. Visit the official AMFI portal and login using your credentials
ii. ARN number will be the user id, and the password is sent to your email by CAMS
iii. After authentication, AMFI gets your personal info directly from NISM
iv. Once you clear the NISM certification/CPE completion, pay the fee online (net banking or debit/credit card) or directly at the fund house
v. The registration/renewal of ARN/EUIN happens immediately
In a nutshell, AMFI is responsible for making mutual funds a trusted and transparent investment vehicle over the years. Therefore, if you face any dispute or disagreement with an AMC regarding a scheme, you can file a complaint with AMFI. ClearTax Save is a distributor that offer well-researched and hand-picked mutual funds after careful study. Investing with us is convenient and rewarding. It’s never too late to start.