Working professionals are keen on increasing their income along with their monthly salary. So, a mutual fund is a great place to invest money wisely. A mutual fund distributor is a trained professional who helps these people make correct investment decisions.
To become a mutual fund distributor can be an excellent career path. You can also do it as a part-time job and diversify your professional profile. However, you need to understand the steps for registering as a distributor.
It involves passing exams and collaborating with registered fund houses. The article will discuss all the mutual fund distributor registration steps in detail to kickstart your career in the investment industry. Let’s begin!
Table of Contents
Clear the NISM Exam
Before starting the mutual fund distributor registration process, you have to clear the NISM exam. Passing the NISM-Series-V-A: Mutual Fund Distributors Certification Examination is mandatory for working as a mutual fund distributor.
The exam assesses the candidate’s fundamental knowledge regarding investments and mutual funds. It comprises 100 questions having one mark each, and is all multiple choice questions. You need to complete the exam within 2 hours with a passing score of 50%.
There will be no negative marking in the exam. To appear for this exam, you need to visit the official NISM website and create an account to register yourself. Follow the instructions to fill up the exam form and give the test on the specified date. The registration fee is INR 1500. After passing the exam successfully you will receive the NISM certificate.
Tip: Be well-versed with the latest investment trends, commerce, and national economy.
Complete the KYD Process
After you have cleared the NISM exam and received the certificate, you can move forward with the AMFI Registration. You will need the ARN (AMFI Registration Number) to begin your mutual fund distributor career.
However, you need to complete an identity verification process called KYD.
The KYD (Know Your Distributor) is a document verification process where you need to submit multiple documents, which include –
- NISM certificate
- PAN card
- Address proof like electricity bill
- Identity proof like an Aadhar card, driving license, or PAN card
You need to submit these documents along with the ARN registration application. The document verification processes will happen in any registered CAMS POS office, where you have to submit your paperwork.
It is important to carry the original documents with you during the submission in the verification procedure, along with self-attested copies.
Applying for the ARN
If you have completed the KYD process, you can go to the last and final step – the ARN application process. This is the most important step of the mutual fund distributor registration, as the ARN uniquely identifies you as a distributor.
The respective authorities will verify your documents and applications for assigning you the ARN. Along with this number, you will also receive an Employee Unique Identity Number.
Then, you will get a photo ID card containing your personal details, photo, ARN, and the ARN validity period. You will be officially prepared to work as a mutual fund distributor.
Partnering with a Mutual Fund House or AMFI Distributor
After completing the mutual fund distributor registration steps, you can join a fund house or AMFI distributor. It will allow you to sell mutual funds and earn commissions systematically.
You will have to discuss the payment procedure and commission amount on each sale or customer interaction. If you find the terms of the agreement convenient, partner with them and start working as a distributor.
Remember that the commission amount can vary according to the type of mutual fund you sell. Moreover, successful mutual fund houses and asset management companies can offer a better commission rate.
So, you must research thoroughly and reach out to multiple companies before selecting an AMFI distributor. Check out their previous service history, customer base, and clients to understand more about them.
While completing the mutual fund registration process, keep an eye on the official website of AMFI and NISM. It will help you to know about any latest notices or updates regarding the exams, application rules, and associated procedures.
Contact the respective offices or discuss with experienced mutual fund professionals if you have any doubts about the registration process.
Additionally, always keep the verification documents secure until the procedure is over.