How Technology is Helping the Mutual Fund Industry in Growing Significantly

Over the years, tech has revolutionized countless industries — both large and small, and the mutual fund industry is no exception. In recent years, the Indian mutual fund industry has grown considerably, and there is no doubt that technology has been among the key drivers fueling its growth. As technology advances, their technological counterparts have replaced many traditional methods in the mutual fund industry. Technology is essentially laying the fundamentals of the new emerging landscapes for the rising mutual fund ecosystem. There has been an increasing number of innovations targeting different aspects of the industry, including portfolio management, data analysis, or overall penetration of mutual funds among the masses.

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In this article, we discuss how the mutual fund industry leverages technology to grow:

Digital marketing

Lack of penetration has always been the biggest challenge faced by the mutual fund industry in India. However, in recent times, the exposure to the internet and social media among the masses has increased considerably, making it easier for the industry players to relay information to remote areas of the country. Today, social media is becoming an effective, low-cost marketing tool for fund houses, allowing them to establish a dialogue with their investors in real-time. This technology revolution in the industry benefits the investors, enabling them to get all necessary information online without relying on agents.

A paperless experience

The days have gone by when investing in mutual funds required investors to go through extensive paperwork. Today, the entire mutual fund investment process, from transaction money to investment to KYC verifications, can be seamlessly done online without fulfilling physical or on-paper requirements. The introduction of e-KYC using Aadhaar plays a crucial role in online investing. It benefits both the investors and the fund houses by enabling instant verifications while eliminating the costs incurred in paper maintenance and movement.


Investment advisors play an active role in shaping the market. Investors typically invest their money in schemes recommended by their advisors. However, it is unlikely that all advisors will have the same understanding and grip over the market, which sometimes results in contradictory investment advice. To make investment advice more transparent and reliable, many fund companies have started using Robo-advisors. For those unfamiliar with the term, Robo-advisors are a class of financial advisors that provide financial advice or investment management tips online with little to moderate human assistance. Services provided by Robo-advisors are based on mathematical rules or algorithms which are executed by software. Robo-advisors have expanded the reach of investment guidance directly to those unable to afford advisors’ fees.

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Mobile applications

As the world continues to adopt a mobile-first strategy, every major industry is transitioning to mobile platforms from traditional methods. A seamless, coordinated, and easy digital access to information and services is demanded more than ever among the consumers. The mutual fund market is flooded by countless applications providing all sorts of financial services, and this trend is expected to grow further in the future.

Mobile applications have completely transformed investing. People now have instant access to every financial service on their mobile devices, whether through money transactions, portfolio management facilities, information asset allocation, or complex market analytics. For example, if an investor wants to invest in Birla Sun Life Mutual Fund, he/she can instantly easily get all the required information on his/her mobile device within minutes.

Mobile devices have become critical in penetrating the country’s rural areas, with some fund houses even allowing mutual fund investments by merely sending an SMS.

Efficiency in distribution

With the rise of digital platforms, an increasing number of young investors, especially tech-savvy, are opting for online platforms to buy mutual fund schemes and systematically manage their money invested in various funds. To meet the investors’ requirements and make the schemes easily accessible, several fund houses now make their mutual funds available through online marketplaces. Internet-enabled devices are becoming instrumental in expanding the sales channels to previously unexplored markets by educating people about various products and schemes.

Market analytics

In this highly competitive mutual fund market, it is critical for Asset Management Companies (AMCs) to be aware of consumers’ investment habits. The companies rely on predictive analytics to have a statistical perspective of investor actions and potential investments’ possibilities. To make future asset management strategies, AMCs are now heading to social media platforms to direct communication with the investors and gather relevant data through these interactions. Companies then use this data to produce data-driven models by deploying big data and cloud computing techniques to drive maximum efficiency in the asset management process while strategically lowering the costs.

What’s next?

Technology has had a substantial impact on the mutual fund industry. The industry has been able to solve many problems only through technological innovations. Tech innovations in the mutual fund industry have assisted fund houses in lowering the operational cost while simultaneously benefiting the investors by providing services instantaneously and transparently. The Indian mutual fund industry still faces many challenges, but it’s the growth path with this tech advancement. It is expected to continue a steep climb in the future. It’d be prudent to jump on the bandwagon!

Jason B. Barker

Social media expert. Student. Music advocate. Travel aficionado. Bacon scholar. Skydiver, risk-taker, hiphop head, Eames fan and Guest speaker. Acting at the intersection of design and purpose to develop visual solutions that inform and persuade. I am 20 years old.