Table of Contents

Sl. No Particulars Page. No

1 2 3 4 5 6 7

List of Figures Acknowledgements EXECUTIVE SUMMARY PROBLEM DEFINITION APPROACH TO THE PROBLEM Company profile
Research methodology DATA ANALYSIS:
IFAs Demography Asset under Management: IFAs business Challenges to IFA Asset allocatio CRM services Factors considered in IFA decision making: Impact of 0% entry loads on the business of the IFA: Method and cost of acquiring, maintaining and developing clientele: Use of MIS Tools Scope of expansion of IF business by aligning his interest with the clients interests Back Office Expense Structure

3 4 5 6 7 8 9

Attrition rate Recommendation and Suggestion

22

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Sl. No Particulars

Page. No

9 10 11

Appendix Bibliography

23 23 24-25

Questionnaire Used in Survey

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List of Figures:

Sl. No

Particulars

Page. No

1 2 3 4 5 6 7 8 9 10
11

Age Profile of IFAs Education Profile of IFAs Number of years in Current Business Number of Employees with IFAs Clients Number of with portfolio worth in term of rupees Business of IFAs Investment in Equity Fund in terms of % of total asset Investment in Debt fund in terms of % of total asset Investment in Liquid fund in terms of % of total asset Various CRM Services provided by IFAs Important parameters which picking a fund Impact of 0% entry load on IFAs busines Opinion on variable pricing option Client Acquisition Method Back Office Expenses Satisfaction level of IFAs about their back office business model Atritation rate

9 10 11 12 13 14 15 15 15 18 19
19

12

13

20

14

20

15

21

16 17

21 22

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Acknowledgement

I would like to thank Mr. Faizal Baig , bdh, sourthern Region , iFast financial india pvt. Ltd, for my project Guide for mentoring me with his constant guidance and support. This project would not have been possible without his unflinching encouragement and supervision .i would like to record our gratitude to Mr.Faizal for his supervision advice and guidance from the early stage of this project as well as giving us extraordinary experiences throughout the work I want to thank my Teacher and internal guide PROF. JAHANVI K.N. for her help in synthesizing and developing the material in this project and for his overall management of this project without whose help it would not have been possible for me to take the task to his subsequent level.

We would also like thank to Mr. Joe in Bangalore office and Ms. Sheeba Satish, HR Manager from Mumbai for their time to time help and support above all, we would like to wish Ifast as an organization to grow ahead and reach its pinnacle in facilitating the IFA business .

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EXECUTIVE SUMMARY
This report gives an insight into the IFA business in the city of Bangalore. It contains detailed analysis based on the survey conducted on the IFAs all over the city. The report includes analysis on various parameters like the challenges faced by an IFA and the scope for expansion of IFA business by aligning his interest with the clients interests . It also contains the classification of IFAs in the city of Bangalore on the basis of demographical factors like age, educational qualifications and the number of years into their current business. The reactions and the impact of IFA business due to regulations enforced by SEBI and zero percent entry load has been studied to depth.

A detailed study on methods and cost of acquiring, maintaining and developing clientele for IFA business is crucial to get an in-depth insight into the IFA business. The analysis based on the survey conducted also includes research support, back office support, technology and the logistics model of the IFA. The various factors consider in IFA decision making have been analysed to give the right perspective of the IFA business.

This report shows that there is a tremendous scope in an IFA business as it remains a highly untapped and an unorganised business. The growth in this business will be fuelled by the

rising India economy and a rise of disposable income of the clients.

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COMPANY PROFILE

iFAST Financial India Pvt. Ltd, a joint venture between iFast corporation TE Ltd and deutsche bank s asset management division , through deutsche asia pacific holding pte ltd (singapour) , has arrived in india to offer an integrated wealth management platform to independent financial advisers ( Ifas).

In the muture financial markets in us, Australia and UK the independent financial advisory model that offers unbiased investment advice and holistic financial planning with a wide product selection in the dominant model in the financial advisory industry with the largest assets under management. In Singapore, this trend is emerged in 5 short years.

iFAST corporation Pte Ltd is singapore s leading provider of investment transaction and administration service for IFAs and the largest distributor for mutual funds, we have precipitated the phenomenal growth of the new independent financial advisory model with our breadth of services and technology tools.

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PROBLEM DEFINITION
The ifast is the leading provider of transaction platform for mutual fund in Singapore, Hong Kong and Malaysia and gas just started its operation in India There are basically four kind of channels in mutual fund distribution in India 1. Domestic and Forgein Banks 2. National distributors 3. Regional distributors 4. Independent financial advisor (IFA) It is the IFA s which the company is targeting in india for starting its operation by providing them with an integrated front and back end support. It will help them to get the real value which they deserve in terms of fee they charge from the customer which is presently almost nill. By doing this they will be creating a win win situation for all the stake holders. Ifast wants to bring together all the IFA s providing pms service in India and to empower them with in-house research so that they can help in product selection , financial planning and asset allocation for their respective client. Summer interns are required to do the study of the challenges of IFA in Bangalore city in order to launch their product in Bangalore and to tap the IFA market . study will focus on several aspects of IFA and thus will help IFAST target the challenges faced by IFA 1. A complete new platform to deal with all the amc at single window 2. Flexibility in product selection, redemption and switching between funds as per need of client 3. Facility to track the client portfolio in order to suggest the best available fund for investment 4. To get away with hassels of multiple form filling and unnexessary paper work
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APPROACH TO THE PROBLEM:

IFA business was categorise in eight dimension as fallows To understand the various challenges faced by IFA s and to facilitate them with necessary solution by providing them with best offerings available To facilitate better understanding of the revenue model of the various IFA s this will help in differentiating between the various type of IFA S for example : what percentages of revenue come from upfront income from recurring level. To understand the various implication (both positive and negative) due to various SEBI policies. To understand the relationship between the investor and the IFA s at broader level and suggest ways to improve the relationship through the new platform To understand the means through which IFA s attract customers and to facilitate the IFA in acquiring more customers To compare the use of technology among the various type of ifa and to help them with better use and more judicious technology which support their business To compare the various advantage and disadvantages of the IFA business compare to the bankers business . To understand the various back hand operation of the IFA s and devise means to improve their back office. Each IFA s will be studied on above mention parameters. a questioner will be prepared which will be used to collect secondary data through field work. Based on collected data. Analysis will be done which will include various analytical ?graphical models

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Research design:
Objective of this project is to study IFA business to get the insight and understanding of their business. In order to achieve this objective and exploratory research was conducted based on eight parameters, a questionnaire was develop which contain a total number of 23 question (appendix, A) various scaling and measurement techniques were used in the questionnaire. These scaling were essential to understand the deep insight of the parameter.

DATA ANALYSIS
Diagrame showing age profile of IFAs

AGE
>50 40-50 35-40 30-35 20-30

NO. OF IFAs
47 45 23 20 10

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ANALYSIS:
From the above table it is very clear that 47 ifa have age greater than 50 years. 45 ifa are within the age group of 40 to 50, 23 ifa are within the age group of 35 to 40 , 20 ifa are within the age group of 30 to 35, and only 10 ifa are within the age group of 20 to 30

Interpretation:
From the above it is clear that 2/3 of the ifa are above the age group of 40 year. and it is relevant that they have good amount of experience in their business

Figure 2 representing education profile

Educational profile Graduate Post graduate professional Under graduate

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No. Of ifa 100 25 10 10

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Analysis:
From the above table we can find out that 100 number of ifa are graduate as their educational qualification , 25 number of ifa are post graduate, 10 number of ifa has professional qualification and 10 of them are under graduate .

Interpretation :
From the above table we can interpret that majority of the ifa are only graduated as their educational qualification and very few have professional qualification or are under graduate.

Figure representing year of business

Year 0-5 6-10 11-15 >15

Percentage 35% 46% 6% 13%

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Analysis:
From the above we can find out that 35% of the ifa are in the business from the period of 0 to 5 years , 46% of ifa are in the business between the period of 6 to 10 years , and only 6% are in the business from the period of 11 to 15 years and 13% of ifa are in the business from the period of more than 15 years .

Interpretation:
From the table we can interpret that most of the ifa are in the business from the period of 5 to 10 years

Figure representing number of employee with ifa

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Number of employee <10 10-20 21-30 >30 Analysis:

IFA 95% 2% 2% 1%

From the above table we can say that 95% of ifa has less than 10 employee ,Only 2% ifa has 10 to 20 employee, and 2 %ifa has employee between 21 to 30 , and only 1% ifa has more than 30 employee.

Interpretation:
From the above diagram we can interpret that most of the ifa has employee less than 10 and very few ifa has employee greater than 10

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Figure representing clients worth below 10 lakhs

Clients 0-100 101-200 201-300 >300

IFA 43 39 18 25

Analysis:
From the above table we can say that 43 ifa have less than 100 client worth of 10 lakhs . 39 ifa has client number from 102 to 200 worth of 10 lakh, 18 ifa has client number from 201 to 300 worth of 10 lakhs and only 25 ifa has client number more than 300 of worth 10 lakhs

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Interpretation:
From the above data we can interpret that most of the ifa has lclient number less than 100 worth of 10 lakh . and very few of them has client more than 300.

Figure representing challenges faced by ifa

1 Challenges to ifa./ rank Volatile market Limited access to exclusive product Access to quality research Client acquisition and service Maintenance of cost effective back office Over dependence in transaction based Geographical constraint 65 10 5 25 10 10 5 15 20 20 30 20 25 10 10 35 35 30 30 20 15 10 35 40 15 40 45 70 2 3 4

Interpretation
From the above we can interpret and due to economy slowdown mutual fund business was the hardest hit and that s why ifa s have to suffer huge losses in their business . so almost all ifa told that volatile market is the biggest problem. Another important factor while we came across while studying ifast is that they find it difficult to acquire clients and services this is the area where ifast can pitch their product as it is service oriented products.

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Figure representing various service by IFA

Various service
E statement Portfolio tracking and management Online access to their account Online access to fund transfer

%of ifa
66%

29% 18% 9%

Analysis:
From the above chat we can find out that 66 percent of ifa provide E statement to their client. 29 percent of ifa keep portfolio tracking and management of their client asset. 18 percent of ifa provide online access to their account to their client, and only 9 percent of ifa provide online access to fund transfer.
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Interpretation :
from the above analysis we can interpret that most of the client provide e statement to their client as their major service and very few of them provide online access to fund transfer to their client.

Figure representing

Analysis
Above table show that 74% clients were satisfy, 21% are neutral and 1% are highly satisfy, so most of the clients were satisfy with there back office . INTERPITATION Most of the IFA are satisfy with there back office.

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Figure representation of back office expense

s.no 1 2 3 4 5

BACK OFFICE EXPENSE RENT (office, electricity and other fixed monthly charges) Courier services, stationary . Telephone and other expenses, Employee compensation Others.

TOTAL % 6.26% 4.08% 4.44% 6.16 3.39

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Analysis:
From the above table it is clear that ifa expense about 6 percent for the rent, 4 percent for courier and stationery ,4.5 percent for telephone expense, 6 percent for employee and other expense is 4 percent Interpretation :

Rent is major component for an average.IFA but employee compensation is bigger component among the bigger IFAs. Employee compensation is not an issue with individual IFAs as they are working for themselves. So their cost structure is entirely different than bigger IFAs.

Figure representation on sebi variable pricing

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S.no 1

SEBIs proposal on variable pricing

Total % 0 .78%

Others 2 Welcomes 3 Neutral 4 Some what oppose 5 Strongly oppose 33% 22% 31% 14%

Analysis:
From the above data , we can say that 33 percent ifa strongly oppose the sebi strategy, 22percent oppose but not strongly, 31 percent of ifa were netural and 14 percent of ifa welcome the sebi regulation

interpretation
A large % of IFA s said that by introducing variable pricing SEBI s only create confusion in the mind of the customers and there will be a lost of trust which will have huge negative impact on there business

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Figure representation.

Interpretation:
from the above analysis we can say that most of the ifa use referral model for accquring the clients. And very few of them use email service to acquire the clients

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Recommendation and suggestion.

As we can see the above analysis that IFA s are facing challenges and difficulties in present scenario , I would like to suggest that they can overcome from this problem by using some platform available in today s market, like KARVEY CAMES some private platform and Ifast financial Pvt ltd .

I would recommended them to use ifast platform because this platform enable them with the solution of all the above mention problems and also enable them to use much of the important time in productive work. Ifast financial will help them to expand geographically and help the IFA s & client with online excess of their statement and records, ifast financial also help IFA s to act like a bank and to give all services to their client which banks are giving to their HNI clients , like transfer of fund online, giving separate log in id to client. And providing statement online. By using Ifast financial platform ifa can reduce their back office expense and reduce their logistic cost .and can give very very high quality of service to their client.

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BIBLOGRAPHY:

www.Sebi.com www.ncfmindia.com www.ifastfinancial.com

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