The Association of Mutual Funds in India is the authority that sets all guidelines related to mutual funds, AMCs, investors, and any other registered entity or persons linked with buying, selling, or managing mutual funds in India. It also ensures that all the guidelines are strictly abided by and swift coordination is maintained between asset management companies, stock exchanges, and SEBI.
To tackle unbaked myths and rumors circulating in the market and establish a robust system for mutual funds, AMFI was founded on 22 August 1995. It has, since then, successfully achieved its objectives, leading to significant growth in the mutual fund industry over the past years.
Objectives of AMFI
It aims to ensure that businesses and individuals adhere to the guidelines regulated by it. All the guidelines, rules, and regulations must be abided by in due course of business.
AMFI works in coordination with SEBI to ensure that the stock markets and the related mutual funds work hand-in-hand. This coordination also involves abiding by the guidelines set by SEBI.
AMFI works towards spreading awareness about various upcoming schemes. It again uses various media channels to achieve this goal.
AMFI has created portals and grievance management services for investors and AMCs. This is to solve problems in case any discrepancies arise.
AMFI functions through 4 major departments; namely:
Committee on Valuation
Committee on Financial Literacy
Committee on operations and compliance
Committee on registration of certified distributor
AMFI Registration Number (ARN)
Any intermediary involved in the distribution of the fund should have registered with the AMFI. Following this, they will be provided with a unique identification number called the ARN (AMFI Registration Number). This will be allotted by the NISM (National Institute of Securities market) at the end of the training.
Those willing to get themselves registered are to go through an assessment or examination to get the number. They will have to renew this after every 6 months to exercise the full rights that come along. One can simply apply for the same online via the official website of AMFI.
Key functions of AMFI include:
Investor Education: AMFI runs campaigns and initiatives to educate investors about mutual funds, their benefits, and the risks involved.
Code of Conduct: It establishes a code of conduct for its members to ensure that they act in the best interests of investors.
Standardization and Best Practices: AMFI works on standardizing practices and processes across the mutual fund industry, ensuring transparency, and adopting best practices.
Liaison with Regulators: AMFI acts as an intermediary between the mutual fund industry and regulators like the Securities and Exchange Board of India (SEBI). It also plays a role in providing feedback on regulatory changes.
AMFI Registration Number (ARN): AMFI provides registration to intermediaries (distributors and advisors) in the mutual fund industry by issuing them ARN numbers, which are mandatory for distribution and advisory services.
