The Hindu Business Line : Now, financial planners begin to ride the BPO wave

AMERICANS, whose surprise at finding Indian voices resolving their issues from computers to credit cards has barely abated, will soon discover that even their investment advice is coming from Indian shores. Financial planning and investment advisors in the West are increasingly partnering with Indian firms to outsource the actual planning of their customers' finances.

Financial planning companies abroad collect relevant data from their clients, assess their financial needs, understand their risk and return profile and forward this information to their partner in India. Subsequently, the Indian partner puts the data together and comes up with the perfect investment advice for the client.

For instance, a client who earns $2,50,000 a year will give information including the number of children he has, loans and mortgages that are being repaid and the return that he expects from his investments. Based on these details, the financial planner in India would assign the necessary amount that the client should invest under various sections like insurance, real estate investment trusts, mutual funds, equities etc. The actual sumunder each of these heads differ based on the income, age and family profile of the client as well as his financial goals.

The Association of Financial Planners in India acknowledges that this would be a viable line of business for potential chartered financial planners even though the numbers are fairly low, currently.

"We would be actively talking to other countries for generating such businesses. Even though some business is trickling in, the fact that there are only a handful of qualified planners in India currently, is a hindrance," said Mr Ranjeet S. Mudholkar, Chief Executive Officer, Association of Financial Planners (AFP).

AFP is talking to planning companies in the US and Australia for providing this service.

There would be a saving of at least Australian $20,000-30,000 per planner, per year, if this activity is outsourced to India. Medium to large financial planning houses employ between 40 and 100 planners. "The savings potential for them is huge," he adds.

The Mumbai-based qualified chartered financial planner, Mr Gaurav Mashruwala, says he is getting a lot of enquiries from American planners who want to outsource the planning function from India.

"It has the potential to be a big business for India. This also means that Indian planners would have to update themselves about international products and understand taxation issues relevant to these countries," he said.

The AFP confers the Chartered Financial Planner (CFP) degree to candidates who pass all six modules of the AFP course. CFPs looking to practice outside India would have to clear additional modules in order to be fully qualified.

Indian planners who provide BPO services may also have to get qualified on these additional modules.

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