Go rural: Rangarajan tells Mutual funds

Mumbai, Feb 6 (UNI) Extending Financial Inclusion to rural people concept to the Mutual Funds, Dr C Rangarajan, Chairman of the Economic Advisory Council to the Prime Minister urged Mutual Fund Industry to extend the benefits of its investment to the rural ivestors and maintain clarity while communicating product information.

Dr Rangarajan said the limited reach of mutual funds in the rural areas was a cause concern. Most of the fund houses have their sales office locations in top 10 cities, with token presence in the remaining cities.

In his keynote address at the fifth ICRA Mutual Fund Award 2008 here last nitgh he said '' We are still in a nascent stage of development of mutual fund industry, which is concentrated in few metro cities only. There is need for extending the message of mutual fund investment to the rural investors.'' Pointing out that according to the Invest India Economic Foundation survy--threre are around 34 million potential investors in India of which 57 per cent live in rural areas--he stressed, ''There is greater scope for both widening and deepening the spread of the mutul fund industry in India through greater penetration ofrural and lower income groups in non-metropolitan areas.'' Appraising the recent reguatory reform introduced by the market regulator Securities and Exchange Board of India (SEBI), the economist said, ''SEBI's move to waive entry loaded for applications received directly by asset management company (AMC) and not routed through any distributor or agent or broker is a welcome reform.'' He further suggested that the industry needs better and clear information as well as investor education.

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