AU Small Finance Bank to start distributing Mutual Funds

Chandigarh, November 28, 2017: AU Small Finance Bank (AU SFB) [BSE: 540611; NSE: AUBANK], has entered into agreement with 11 Asset Management Companies (AMCs), both domestic and international, to distribute their mutual funds. The bank aims to be a one-stop shop for its existing customers. Within 6 months of commencing banking operations, AU SFB has started cross-selling general insurance and health insurance, and now adds mutual funds in its product offerings.



Mr. Sanjay Agarwal, MD & CEO of AU Small Finance Bank said, "Our intention is not just to boost revenue but to provide all financial solutions to our customers for better services leading to better customer retention. In addition to that, being a Small Finance Bank, we have advantages of greater market presence in low and middle-income category, unserved / underserved geographies compared to other banks which provides a strong distribution platform to the AMCs"



AU SFB has wide presence in B15 cities, which would help AMCs to tap semi urban markets that are still largely underpenetrated. This broadens the bank's scope of reaching out to larger customer base in different parts of the country thereby aiding to government's initiatives of financial inclusion.



"As a Bank we would focus on Systematic Investment Plan (SIP) as it imparts financial discipline in the lives of retail investors. It also provides the benefit from the power of compounding and averaging purchase cost, keeping the volatility of the market aside", said Mr. Agarwal.



AU SFB's primary objective is to provide a need based investment solution based on customers' investment objective, risk appetite and time horizon. The bank believes that it is important to raise awareness about the risk associated with mutual funds and impart its customers with a habit of investing a small amount regularly through SIPs to participate in mainstream financial investments.



The bank would use NSE NMF II, a seamless platform to process the mutual fund business where there is only one time need of customer registration.