The mutual fund industry has been focused on expanding its reach beyond India’s top cities, and the B-30 scheme plays a crucial role in that mission. Recently revived, this scheme provides additional incentives to mutual fund distributors and AMCs for bringing investors from smaller cities into the financial ecosystem. Here’s a complete breakdown.
🌆 1. What is the B-30 Scheme?
“B-30” stands for Beyond Top 30 Cities. The scheme is designed to promote mutual fund investments from Tier-2, Tier-3, and rural cities — areas where mutual fund penetration is still very low.
💰 2. How the Incentives Work
Under the B-30 scheme, mutual fund houses (AMCs) are allowed to pay additional commissions or incentives to distributors who bring in investments from these cities. The extra expense is charged to the scheme’s expense ratio but is capped by SEBI to ensure investor protection.
🎯 3. Primary Objective
The goal is to encourage more participation from:
Small-town investors with limited access to financial literacy
First-time investors who are not part of India’s top 30 urban centers
Rural households looking for a formal savings channel beyond gold and fixed deposits
👨👩👧👦 4. Who Benefits the Most
Distributors: Get higher trail commissions for mobilizing assets from B-30 cities
Investors: Gain exposure to mutual funds with better awareness campaigns
AMCs: Expand their investor base and build long-term assets under management (AUM)
🛠️ 5. Key Features for Investors
No Extra Cost for You: The incentive is built into the expense ratio, so you don’t pay anything separately
Same NAV, Same Returns: Investors from B-30 cities get the same NAV and portfolio as everyone else
Encourages local Awareness: Fund houses often conduct financial literacy drives in these areas
📊 6. Impact on Mutual Fund Industry
The B-30 scheme has been instrumental in:
Increasing Systematic Investment Plan (SIP) registrations from smaller towns
Reducing concentration risk (not relying only on metro investors)
Helping india achieve wider financial inclusion
✅ Bottom Line: The B-30 scheme is a win-win for everyone — distributors, fund houses, and investors from smaller cities. If you live in a Tier-2 or Tier-3 city, this is a great time to start a SIP and build long-term wealth with better accessibility and support.
Disclaimer:
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