In conversation with Business Standard’s Kairavi Lukka, Gaurav Rastogi, founder and chief executive officer of Kuvera; Nilesh Naik, head of mutual funds at PhonePe; Rajiv Bajaj, chairman and managing director of Bajaj Capital; and Swapnil Bhaskar, managing director and chief executive officer of JioBlackRock Investment Advisors, discussed how technological innovation, artificial intelligence (AI), investor education, and traditional advisory services could shape the next phase of growth.
Mutual fund growth potential
Rastogi said the number of mutual fund investors had risen from around 10 million a decade ago to approximately 60-65 million, reflecting a substantial expansion in access. However, he cautioned against comparing India’s investor penetration directly with that of wealthier countries without accounting for income differences.
“The next level of growth has to come with the country becoming richer, with wealth going deeper into the country,” he said, adding that the industry would then be better placed to bring more people into investment products.
He cited PhonePe’s daily SIP feature as an example of innovation aimed at self-employed workers with daily cash flows. The platform acquired around 500,000 customers for the product within six months, he said.
Bhaskar said technology could help firms understand customer needs more deeply while lowering costs, making micro-investing commercially viable and extending access to a wider population.
AI as an investor tool
The panellists also discussed how artificial intelligence (AI) could change the relationship between investors and financial advisers. Bajaj said AI was increasingly becoming a tool for investors to validate financial decisions, rather than simply replacing human advice.
“Either AI could be your first point of reference, and you validate it with a human, or if your human adviser gives you a portfolio, you can double-check it,” he said.
Bajaj added that investors should not blindly trust any adviser, regardless of how long they have worked together. He said AI-based portfolio analysis was attracting interest from investors seeking a second opinion, including those investing directly in mutual funds.
Keeping investors informed
With market returns fluctuating, the panellists emphasised the importance of helping investors understand volatility and avoid making decisions based solely on recent performance.
Rastogi said platforms had a responsibility to help investors understand market behaviour through historical data and education. He cited Kuvera’s weekly newsletter, which reaches around 150,000 readers, as one way of explaining how markets have performed across different periods.
He added that investors often imagine long-term returns as a steady upward trajectory, whereas historical market movements show periods of sharp declines and recoveries.
Coexistence, not competition
The discussion also highlighted the potential for digital platforms and traditional financial distributors to complement each other rather than compete for the same customers.
Bajaj said fintech platforms had helped expand awareness and bring more investors into mutual funds. As these investors accumulated wealth and approached milestones such as retirement, many could seek more comprehensive financial planning and advisory services.
“It’s an era of cooperation,” he said, arguing that the industry’s growth had created opportunities for both digital-first platforms and established wealth management firms.
Bhaskar said technology could also strengthen existing distribution networks by making investment journeys simpler and more accessible. He emphasised the importance of understanding regional preferences and customers’ relationships with money.