How-to distributor vs RIA business model

How to compare distributor vs RIA business model

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Distributor vs RIA is a fundamental business-model choice. SEBI’s separation prevents conflict of interest; you must commit to one.

Conflict-of-interest disclosure. This guide is published by WebNotes Editorial Team for informational purposes. WebNotes has no commercial relationship with SEBI, AMFI, or any AMC. No affiliate commission is earned.

Step-by-step procedure

See the procedure infobox above for the six steps.

Side-by-side comparison

AspectDistributor (ARN)RIA
RegulatorAMFISEBI
RevenueTrail commissionClient fee
FiduciaryNoYes
Net worthNoneRs 5 lakh
Cost to enterRs 5,000-7,000Rs 50,000+
Compliance burdenLightHeavy
Conflict of interestInherent (commission-driven)Eliminated (fee-only)
Client baseVolume / retailPremium / advisory

Combination not permitted

SEBI’s 2013 RIA Regulations + AMFI norms: cannot hold both ARN and RIA. Must choose.

See also

External references

References

  1. SEBI (Investment Advisers) Regulations, 2013.
  2. SEBI (Mutual Funds) Regulations, 1996.
  3. AMFI ARN Regulations.
  4. SEBI Master Circulars on RIA and MF.

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The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

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