One of the biggest challenges for the Indian markets is the lack of an advisory ecosystem. While the number of unique investors has grown from about 3 crore in 2020 to 10 crore today, the number of RIAs has barely grown. If anything, the number of RIAs seems to be decreasing.

We just have about 900 odd RIAs, and not all of them do holistic advisory, and if you only consider these, the number drops to less than half. That’s a few hundred RIAs for 10 crore investors.

If you consider mutual fund distributors, there are about 2.7 lakh+ plus, but still not enough. For a broad comparison, there are over 27 lakh+ insurance agents. As our markets continue to grow, the number of advisors has to grow exponentially to help new investors.

In a new consultation paper, SEBI has proposed many changes that will make it much easier for people to become RIAs. If these proposed changes become final, it’ll go a long way toward increasing the number of individuals wanting to become advisors.

Link to the consultation paper.

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