Definition of Mutual Funds Distributor

Any firm or an individual who facilitates buying and selling of units within a mutual fund between an AMC (Asset Management Company) and interested investors, is categorised as a mutual funds distributor.

A distributor is basically an agent supplying goods to a retailer. The mutual fund distributor receives payment in advance for each investor they bring in. A distributor who is licensed by AMFI to provide market advice can advise investors regarding the mutual fund schemes they pick.

Points to remember:

• A distributor may be able to sell limited goods of a company or a range of products according to the agreement they have signed.

Example:
Upstox is a mutual funds distributor but does not provide advise on the types of mutual fund schemes you should invest in. It is a broker who gives you an easy-to-use platform to invest in the funds that suit your financial goals.