A program to boost your business profitability

Ajit Menon

Chief Business Officer

DHFL Pramerica AMC

Aiming to help their distribution partners increase their book through productivity, Ajit Menon shares the initiatives around retirement planning that DHFL Pramerica is rolling out for IFAs.

  • Table top tools for SWP, retirement and top up SIPs help advisors to calculate key factors
  • Launch of Retirement Readiness Certification in collaboration with CIEL
  • More distributors want to understand the distribution phase of a client’s life cycle better – this certification will help bridge this key gap
  • Two batches already certified, third batch due for certification by month end.
  • Focusing on retirement planning leads to better outcomes for clients, stickier assets and enhanced profitability for distributors – a win-win for all.

WF: What is the overarching theme that you want to build your IFA engagement on?

Ajit: We have a comprehensive engagement plan for all our partners. The overarching theme under which we will be building our engagement platform for our partners is the aspect of productivity. In our interactions with our distribution partners and advisors across the country, the feedback we get is while there is optimism among the distribution fraternity about the opportunity that lies ahead as more and more customers walk in to their offices, the big question that lies in front of our partners is how to scale up.

While we have been saying that it is a push market rather than a pull market, it is slowly beginning to change. Even though it continues to be a push market, the element of pull has increased and that clearly is where the opportunity lies for a lot of the existing distribution partners and new people into the market to scale up their business. The key area they would focus on is how to get more productive.

Productivity involves not just the interaction and efficiency with clients but also means productivity in operations, technology tools and the training that is provided for their staff. Those are clearly the areas we will also focus on as well in terms of providing small technology based solutions that will help our partners to scale up their business faster, more efficiently and get better.

On the productivity front, we have already launched a few tabletop tools for the smaller distribution partners across the county where it helps answer a few key questions. There are SIP tools in the market but there are very few SWP tools in the market and we have created one that is getting some good feedback from our distribution partners that have seen it. The SWP tool can help to calculate how long will the corpus last, various portfolio return levels and what is then left over as legacy.

We have also created tabletop tools around the area of retirement. The tool can help calculate what would be the corpus that would be required depending on various expense levels at this point of time. If a client wants to reach a certain corpus level within a time frame, the tool can help in suggesting what kind of SIP as well as top-up SIP would be required.

Top up SIPs are something our industry partners have been talking about as a very, very good way of building the franchise for our partners. It is also something that fits in very well for investors because as their incomes rises, their SIP keeps pace. So, it is an easier way of building the corpus in top up SIP model. We have created a tool around that and that has got good reviews from the distribution partners.

Our plan is to increase the number of productivity tools like the SWP tool and the retirement tool. We will be coming up with few more tools for partners in the near future.

“Focusing on retirement planning leads to better outcomes for clients and makes for long term sticky assets and a profitable model for distributors. A win-win situation”

WF: You have recently launched an initiative called the Retirement Readiness Certification. Can you walk us through why the initiative was launched with retirement planning in focus?

Ajit: The area of retirement is gaining more and more attention from all of our partners. We believe this is an area that DHFL Pramerica can play a reasonably significant role for our partners. One of our parents, Pramerica, better known as Prudential in America, is a very large player in this space of retirement. So, we intend to leverage that relationship as much as we can.

From our conversations with distribution partners, we know that lots of clients have been impacted by interest rates moving lower and they are looking for solutions. When you look at it independently, retirement is a beautiful space to focus on for our advisor partners because it is the one goal for which you can't get a loan. We talk about financial goals like children's education, marriage, buying a house -- all of these are goals for which you can get a loan. Therefore, focusing on understanding this aspect better would lead to better outcomes for our clients & makes for long term sticky assets and a profitable model too. A win-win situation. The only life goal for which you cannot get a loan in the world today is retirement.

As people put aside money for various financial goals like children's education and others, when the goal is reached, the money is essentially redeemed to fulfill that goal whether it is marriage or paying for the education fees. Whereas, retirement is the only goal among the financial goals is where the money stays in the account and the individual decides how much to withdraw monthly so that it lasts him for his lifetime. Therefore, focusing on understanding this aspect better would lead to better outcomes for our clients & makes for long term sticky assets and a profitable model too. A win-win situation. It is therefore a very powerful area for all of us in the industry to focus on and I would want our partners to focus around it.

“There are very few IFA business models that are focused very specifically on retirement practice and we would like to encourage/collaborate on that aspect as one of our key differentiators in the market place”.

WF: Who is the retirement readiness program aimed at and what will be the benefits of the program?

Ajit: While a few distributors talk about planning around the retirement goal, most are happy to focus on the acquisition phase of the person's life and more IFAs want to understand the ‘distribution phase’ of a client’s life cycle better

We would like more distributors to understand the distribution phase of a client's life cycle given the current context of interest rates and its impact on traditional forms of retirement investments.

WF: How has the course been designed?

Ajit: The Retirement Education Certification is an online course where we have collaborated with Uma Shashikant and CIEL as our educational partner. The online course aims to get IFAs to understand the distribution phase of a person's life much better.

Hinang Shah from Ahmedabad's KALPAVRUKSHA FINANCIAL SERVICES found the program was useful as “the course gives a new perspective on how to deal with clients over 35. The certification gives you different conversations which helps you to deepen the relationship with clients.” He said that in today's context, clients are getting sales pitches from everyone. “Nobody is asking the right question to clients. The planning is not happening here. Clients are just sold the product.” A certification course like this helps advisors to diverge from presentation to advisory and differentiate themselves from the competition which is just selling products, he added.

We have not tried to peg it at a CFP or similarly tough level - it is a simple course designed to help IFAs better understand the retirement space in India. The objective of the course is to help our partners have a richer, more informed conversation about retirement goals with clients, which would help them in expanding their client base. There are modules about the retirement mindset, principles, the products available, how to execute the retirement solutions, financial dashboard that covers all the relevant calculators, as well as how to convert corpus into income. IFAs who subscribe to the course will be able to download the study material as well as retirement tools which they can keep with them forever.


Given the simplicity of the course design, it may not be suitable for all IFAs. G Sundararajan from Chennai's Rama V felt that while it was more of a beginner's program, “it would be useful for those who are new to retirement and don't have much idea about this area.” He also added that the excel sheet tool from the course was useful. While it may not be very relevant for those advisors with advanced certifications like CFP, Naitik Shah from Rajkot's Shah Investment Consultants said that investment advisors who want to focus on retirement planning would still find it useful.

WF: So how do IFAs complete the course?

Ajit: At the end of the two-month course, there is an exam which IFAs need to complete at NSE centers and they will then receive a certificate. The title that IFAs get on completion is "Retirement Readiness Certified". It is a onetime certificate you can keep forever. We would love to cover other areas and have an advanced certification at some point in the future depending on the need arises. At this point in time, we believe that we should be making it available to a much larger base of people and so we have kept it short and easy. As the course is online, IFAs can do it at their pace and convenience. There are no classes to attend and there are downloadable workbooks. Once IFAs register, they will be given a log in a password and they will learn the course on the CIEL system.

We are subsidizing the course as of now and partners need to only pay a nominal fee to register for this course online and to know more click http://dhflpramericamf.com/retirement

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