Investment alert! Goalwise forays into direct mutual funds

Shifting the business strategy into higher gear, Goalwise, a goal-based mutual fund investing platform, has announced its foray into direct mutual fund plans. With this initiative, the start-up becomes the only investment advisory platform in the country to offer goal-base investing in direct mutual funds free of cost. Earlier, the platform’s offerings were only limited to regular plans. Now, it has made investing completely commission-free while retaining the original product offerings.

Speaking on the development Ankur Choudhary, Co-founder and Chief Investment Officer, Goalwise said, “The only difference between a regular plan and a direct plan is that investing in the former is facilitated by a broker or a distributor, the AMC pays a percentage of the investment as a commission to the distributor whereas no commission is paid in case of a direct plan.” He said that the absence of commission means that investors get to reap more benefits from the direct mutual fund than its regular counterpart. For one, direct mutual funds have a lower expense ratio. Secondly, they fetch higher returns due to the compounding of money that would otherwise be paid as commission in regular plans.

Elaborating on the reason for the focal shift, Swapnil Bhaskar, Founder and CEO, Goalwise, said, “We have taken this decision after conducting in-depth user research with our existing customers, many of whom were very excited about the prospect of us shifting to direct plans. We believe this move will help us become the biggest wealth management platform in the advisory space in India.”

Talking about how the shift will be implemented, Ankur added, “We were already providing direct plans to a handful of our HNI investors on a bespoke basis so the infrastructure was already present. We have now made it available to everyone. We also have a one-click rebalancing tool that is being used to help our investors with the migration. The response to this initiative has been overwhelming. Within 24 hours, 25% of our investors have moved their ongoing SIPs to direct plans.”