India's mutual fund industry embraces technology for growth and transparency

Digital platforms are not just transactional tools, but trust-building mechanisms that can transform how investors perceive and engage with financial products

The Moneycontrol Mutual Fund Summit 2025, held in Bengaluru on October 27, brought together industry leaders to explore how technology is reshaping India's mutual fund landscape.

Discussions centered on growth drivers, trust-building, and the integration of AI with human advisory, highlighting technology's pivotal role in expanding access to investments.

Technology's dual role in industry growth

Sandeep Jethwani, Co-Founder, Dezerv emphasized technology's critical contributions to mutual fund expansion through tangible and intangible elements. Tangible aspects include streamlined KYC processes, simplified account openings, digital public infrastructure, account aggregator platforms, and easier money transfers.

Intangibly, it fosters trust via remote portfolio management, serving clients across 250 locations through video calls, transparent reporting, and secure custodian-handled transactions. "Technology helps in 'hand-holding' investors, especially those investing significant amounts remotely," Jethwani noted, adding that it goes beyond transactions to build comfort and engagement with financial products.

As digital costs drop—like UPI fees—platforms become more accessible and personalized, aiming to guide more Indians into the ecosystem in a trustworthy way.

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Challenges in disrupting established players

Addressing why newcomers like Zerodha haven't overtaken giants such as HDFC AMC, Vishal Jain, CEO, Zerodha Fund House, explained that toppling incumbents requires time, with emphasis on market expansion and accessibility via tech. Digital tools accelerate onboarding and enable small-ticket investments, boosting penetration.

Small investments to get viable as tech reduces costs

Navneet Munnot, MD and CEO, HDFC AMC acknowledged hurdles in small-ticket viability, noting HDFC AMC's Rs 100 monthly SIP options but stressing reductions in KYC and onboarding costs. "Technological advancements will make small ticket investments more viable," he said, highlighting potential for lower transaction expenses.

Jethwani added, seeing small investments as a trust-building step, paralleling UPI's cost evolution. He anticipates improved infrastructure will economically serve smaller investors gradually.

Building digital trust for investor confidence

Platforms demonstrate transparency by handling investments for unseen clients securely, while personalized handholding reduces costs and enhances accessibility.

"Digital platforms are not just transactional tools, but trust-building mechanisms that can transform how investors perceive and engage with financial products," Jethwani asserted. This philosophy underscores technology's role in proving reliability through consistent, secure experiences, expanding reach effectively.

Simplifying investments through digital platforms

Munot outlined digital platforms' transformative potential, powered by AI bots for instant query resolution on products, regulations, and services, managing high inquiry volumes. They excel in data processing for personalized communications tailored to investor profiles, alongside operational gains like cheaper KYC and streamlined onboarding. AI aids education by delivering engaging, accurate info, enabling scalability for diverse segments including small-ticket holders.

"Digital platforms can dramatically simplify investments by making information more accessible, personalized, and efficient through technological innovations," Munot emphasized.

Jethwani discussed AI's current exploratory use, like clients consulting ChatGPT with investment statements, introducing the "Jeffersons Paradox": AI boosts efficiency and institutional memory, paradoxically increasing demand for relationship managers. It makes low-ticket service viable, tracks communications to curb mis-selling, and supports holistic advice. "AI will not replace human advice; instead, AI will enhance human engagement," he believed, making personalized advisory more accessible and valuable.