imgbd Gamechangers : Dealing with direct

A platform to combat direct plans

Ashish and Manish Goel, Vista Wealth, Delhi

27th October 2015

Editorial comment

Wealth Forum has always supported and stood by financial intermediaries - whether you call yourself advisors, distributors or wealth managers. We strongly believe in the value of good advice and are committed to helping you scale higher and serve your clients better. In keeping with this philosophy, we are very happy to introduce a new column in our website, called Gamechangers.


We will endeavour to make Gamechangers an indispensable resource of gamechanging ideas and insights that can help you deal with key business challenges. The foremost business challenge that you face today is dealing with direct plans. Gamechangerswill accordingly focus on this issue, and will provide you a platform to share ideas and insights on how to take on and win against direct plans.

Ashish and Manish Goel, who are among the foremost thought and business leaders in the retail distribution space in India, kickstart this initiative with their thoughts at three levels on dealing with direct. We are grateful to Ashish and Manish for conceptualizing and pioneering this initiative. Wealth Forum will reach out to many more leaders in the distribution space to contribute their gamechanging ideas, insights and experiences in the Gamechangers column.

But its not just the leaders of the distribution fraternity who have all the best ideas. Each one of you has dealt with this issue, and many of you will have valuable insights and experiences to share. Please write in to us at and we will ensure that the best ideas are appropriately showcased, here in the Gamechangers column. The more you share, the better equipped each one of you are to deal with and overcome the challenge of direct plans!

In a nutshell

In this inaugural article of the Gamechangers column, Ashish and Manish Goel discuss how the threat of direct plans can become much larger when aggregator technology platforms start carrying them, offering a single click across direct plans of all fund houses.

The solution they strongly suggest is for distributors to get together quickly, develop a front end application that rides off the NSE platform, and aggressively pitch this to their client bases across the country.

Over time, one tech platform will dominate online mutual fund transaction execution: it is in the interests of distributors to develop and promote their platform, to make it the one that dominates the landscape. Without this, it's going to be an uphill struggle against direct plans; with it there is a great chance of overcoming the challenge of direct plans. It's a choice that distributors need to make, and make fast.


Direct plans are the biggest challenge that distributors are facing today. It is now almost 3 years since the introduction of direct plans. All of us distributors have by now a lot of personal experiences in dealing with the challenge of direct plans - in engaging with existing clients who enquire about direct, who are keen to explore whether to migrate to direct, and some who have migrated to direct. Equally, we see many prospects who have similar doubts on which is the best route for them - direct or through a distributor.

Our purpose of starting this column on Wealth Forum is to share our experiences at Vista Wealth on dealing with the challenge of direct plans. We believe the best way for us to deal with this challenge, is for us to share our own experiences and learnings. We are sharing our experiences, with the hope that many more of you will come forward to share your experiences as well, in this common resource that we can create on Wealth Forum, which can benefit all of us.

We have now seen a full circle of client behaviour - let's share our experiences!

We are now seeing a full circle of client behaviour - people who migrated to direct, had unpleasant experiences, and have come back to us. We have seen equally a number of cases where clients looked interested in direct plans, but after healthy discussions with us, preferred to remain with us. These experiences give us great confidence that we can and will successfully deal with this challenge as well - just as we have dealt with so many challenges in recent years.

But, we can do this only if we candidly and freely share with each other, on a common platform like Wealth Forum, our own experiences and learnings on how to deal with and overcome the challenge of direct plans. Imagine the power of collective wisdom, insights and experiences from hundreds and thousands of distributors across the country - if we are able to harness the power of collective wisdom, we can all emerge successful in this challenge. We can change the game. Lets not forever run scared about direct plans and complain and whine. Lets rise to the challenge, and take it head-on. Lets all become Gamechangers!

Series of articles to cover three aspects

Through a series of articles, we are going to share our thoughts on dealing with direct at three levels:

  1. Technology

  2. Selling yourself correctly

  3. Client stories

Dealing with direct plans: the technology perspective


Nuclear bomb

Direct plans are like a nuclear bomb. Very potent weapon, a weapon of mass destruction. But, what makes nuclear bombs so dangerous is when technology is developed to carry them vast distances - across continents. An inter-continental ballistic missile is capable of launching a nuclear war head from some place in America, which goes and strikes a target anywhere in the world - whether it is North Korea or Syria or wherever. It is the carrier that gives the potent power to a dangerous weapon.

In much the same way, direct plans are a threat to distributors. But what magnifies this threat manifold is when they get loaded onto carriers - when technology seamlessly and efficiently reaches them to every part of the country and beyond. Technology is causing disruptions in many businesses, and in ours as well. But technology, armed with direct plans, is like a nuclear bomb loaded onto an inter-continental ballistic missile.

Historically, transaction execution convenience has been one of the bigger USPs of many distributors. People find it cumbersome to fill out so many forms, lodge them in different places, track and follow up, deal with operational issues etc. This is where a distributor provided convenience. Now, if the convenience shifts from human interface to a technology driven interface, that's great for the investor. But, if that interface drives business to AMCs rather than distributors or if that interface is an AMC owned one, then the game changes completely. If you give seamless online transaction execution convenience and then overlay it with direct plans that are cheaper, price conscious Indians will migrate to such AMC owned and driven tech platforms.

Let the carrier be distributor centric, not direct plan centric

Our earnest appeal to all stakeholders in the industry - distributors and AMCs - is to work together to create and deliver technology platforms that help distributors offer superior convenience to investors. Most AMCs have their own websites through which they promote direct plans. No harm in that. Only few clients will want to go through the effort of signing up with different AMCs and doing separate transactions at each AMC portal. The real convenience is when the industry gets together to create a common transaction platform. Let this common platform be distributor driven. Enable distributors to leverage this to offer convenience. Don't enable AMCs to offer their direct plans through this common platform. Let this platform be distributor owned and driven, not AMC owned and driven.

I am aware that there is a plan to open up MF Utility's online mechanism when it gets launched, to everybody who wants to execute a transaction - distributors as well as direct investors. If that happens, or when that happens, you will have a situation where direct plans are being offered on a common platform. This is not good news for distributors.

Best way forward is for us to create our own carrier

At DFDA, when we discuss issues and challenges, one of the things we really like is that we focus on finding solutions to challenges rather than only dwelling on the challenges. The thinking of many members within DFDA is that the best response to this challenge as distributors should be to work together to create a front end application that interfaces with the NSE platform, to offer our investors a seamless online convenience, but on a platform that does not carry direct plans.

One dominates, others become also-rans


The reality in life is that one platform dominates the space, others become also-rans. There is one google and then there are many other also-rans in the search engine space. There is one Facebook, there is one WhatsApp and then there are so many other also-rans in these respective social media spaces. Point is, one dominates, others are insignificant. It is upto us as distributors to work together, develop a front end application that rides on the NSE platform, and promote that vigorously with all our tech savvy investors. It is for us to make this popular, it is in our interest that our platform becomes the dominant mutual fund platform in the market. If 50,000 IFAs can promote a joint platform that we develop, why won't it become the industry standard? If we don't do this quickly enough, the nuclear bomb will be loaded onto an unfriendly carrier, and that is not good news for us at all.

IFA associations, IFA leaders - lets come together quickly on this one

We are calling upon all IFA associations to come together and work with us in creating such an application. Many thought leaders at DFDA have already commenced work in this direction. It is heartening to note that NSE is willing to open its platform to help applications that we develop to connect with it. Lets work on this project jointly, lets give it top priority, lets launch it and then lets aggressively promote it within our own client bases. Remember, one platform will dominate the space in 3 years. It should be ours - it should be a common distributor driven platform.

We have been silently watching technology platforms coming in, with propositions that are not at all in our interests, and which increase the threat to our business models. Its time to create our own platform, promote it, and make it the industry standard. Its time to change the game!

We invite all distributors to share your thoughts on this game-changing idea. Share your ideas and suggestions on creating this technology platform. If some of you have already done work like we are doing, let's try and pool in thoughts and resources for collective good. Its time to get together friends, and change the game!

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