DELHI-BASED RICHA, 40, successfully cleared her registered investment advisor (RIA) certification exam in 2021. It was a moment of triumph for her after narrowly missing out by just one mark the earlier. However, the joy was shortlived. Three years later, she found herself at the starting line, needing to undergo the certification process all over again.
"I was asked to go to Chennai for the exam. The online option wasn't available. I was required to retake the entire test from scratch. It just wasn't worth the hassle, so I decided to let my licence lapse," laments a disheartened Richa.
Her story mirrors that of many others who, despite passing the RIA certification exam, chose not to renew their licences because of stringent regulatory requirements. Additionally, many financial professionals opted against pursuing the RIA certification, pointing to the high net-worth thresholds and fee structures that are not suitable for their small retail clientele.
This explains why, even 11 years after the market watchdog, Securities and Exchange Board of India (Sebi), introduced RIA regulations, the number of RIAS in the country remains shockingly low. According to data, currently, there are just 995 RIAS registerd with Sebi, which translates to one investment advisor for nearly every 200,000 investors in the country. In fact, the actual number of practicing RIAS, per experts, is much lower.
"The real number is less than 300," says Sharan Hegde, a finfluencer with more than 6 million followers across multiple social media platforms. "I work with a SaaS company that provides software to RIAS, so I have visibility into the data. This includes both individual and corporate RIAS."
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