The Indian B2B Distribution market is going to see a change this year and in the coming years. Yes, we are hammering on the word of B2B predominately since this market in the financial world is now going to be a big market now. The 3rd party distribution market is going to witness significant growth and the most interesting thing will be to find out who grabs the major share and become the next B2B king.
The B2B business model will find significant growth in the coming months and years. Particularly Fy-22 will find see change. The industry of 3rd party product distribution where Mutual Funds, Fixed Deposits, capital gain Bonds, Life Insurance and General Insurance will find new heights of growth and opportunity.
In the last couple of years, we have found that many midsized distribution companies went out of the industry as the revenues and scope of the market was not so lucrative. In fact, last 2 years mostly servicing have been the mainstream compared to business. ManyB2B models were exiting the 3rd party product distribution models and were focusing on B2C. Falling margins forced B2C headcounts to be reduced at the same time running the business and scaling despite online facility in various products have been a challenge.
But covid has changed the rules of the game and the whole perspective of B2B model. The pandemic 2nd wave has created and passed significant opportunity and knowledge. Loss of sole bread earner or loss of significant income due to treatment, loss of, loss of jobs are all the reasons behind the stupendous opportunity of B2B market. Many new brokers/agents/advisors are now going to come to earn and make a living now. The B2B is a profession that is going to make earnings for many people post this covid 2nd wave. The opportunity for these people who have lost in various segment of life is that they will get the financial distribution industry ready to adopt and train them quickly. Further pandemic lessons can be utilised judiciously for making new sunrise for the B2B Financial Distribution Industry. Technology platform along with hunger will play a transformation for the Industry. Its time for investments in B2B vertical. Its time to keep your arms and ammunition ready to facilitate the growth of the B2B new players.
In the last year most of the 3rd party product distribution platforms of B2B segment focusing on the Insurance vertical. High revenues and significant awareness lead to the growth of focus. The 2nd wave has simply amplified the prospects of the B2B distribution platform. The Ties 2 and 3 cities are going to find the new breed of agents/advisors/brokers in these 3rd party product distribution models. Rural India will find a significant number of newcomers in this B2B profession after learning the lessons of a pandemic.
Lack of Insurance in the 2nd wave has created the demand for the product. Plain vanilla term policy benefits arising out of covid -19 2nd wave is going to create demand for the product. Efficient financial planning, contingency planning and asset management increase the demand for financial advisory. The awareness of financial management and Insurance products has scaled to new heights which will come in real numbers post the 2nd wave. Those who had health or term insurance know the benefit of the same and those who never brought the products are now the new buyers.
Many new General Insurance and Life Insurance agents will join the industry. The insurance segment of POS and B2B is going to find stupendous growth in the coming days. This will help the distribution industry of Insurance to grow as well as the penetration level of Insurance products will increase. Term and health are not only going to dominate the segment but other insurance products like Group medical Insurance, Housing society Insurance, Property Insurance, liability insurance etc are equally going to find significant market growth in coming days.
Once the interest rate market starts climbing up and god forbid if there is any Franklin Mutual Fund type of cases or any corporate defaults then the corporate FD market will find huge growth. We have seen in the past how the industry has attracted inflows in corporate FDs. Last two years the FD market has been silent which is going to grow in the coming quarters.
Financial planning and contingency planning has now become a significant topic. Many new mutual Fund IFA’s will be joining the Industry. In this pandemic, many Industry veterans who have left the industry might be opening up the advisory vertical which is going to be another big business for the B2B industry. It’s going to be big competition among the companies who are into 3rd party B2B distribution to gain in size. Please note whoever strategies and handhold the newcomers they are going to replace the old ones.
0 Comments:
Post a Comment