Department of Posts to Expand Mutual Fund Distribution After Maharashtra Pilot Project Success

The Department of Posts (DoP) has concluded its first Mutual Fund distribution pilot in Maharashtra and is preparing for a broader rollout. The pilot covered 4 cities, Mumbai, Pune, Nagpur and Aurangabad, as per news reports.  

Around 320 postal employees were trained, and 280 appeared for the National Institute of Securities Management (NISM) certification exam. Of these, 135 cleared the test and are expected to start offering mutual fund services through selected Post Offices. 

Agreement with AMFI 

The initiative follows a Memorandum of Understanding (MoU) signed in August 2025 between the DoP and the Association of Mutual Funds in India (AMFI). Under this arrangement, India Post will register as a mutual fund distributor.  

Trained employees will be responsible for selling mutual fund products and handling customer service. The agreement is valid for 3 years, from August 22, 2025, to August 21, 2028, with a provision for renewal. 

Phased Rollout Planned 

The national rollout is expected to happen in stages, as staff training and certification will take time.  

The plan is to train about 10,000 employees across the country, beginning with roughly 5,000 to 6,000 staff members. Punjab and Haryana are among the next states identified for the expansion. 

Concentration in Large Cities 

Mutual fund assets in India remain largely concentrated in major urban centres. As per reports, around 80% of total assets under management come from the top 10 cities, while the top 30 cities account for most of the industry’s activity.  

Although about 65% of Indians are aware of mutual funds, only around 7%, or about 5.9 crore people, currently invest. Maharashtra alone accounts for ₹80.23 lakh crore, or 40.4%, of the country’s total mutual fund assets. 

Incentives Under Consideration 

Postal staff may receive incentives for bringing in new investors, in addition to regular commissions. The structure for sharing the ₹2,000 incentive announced in the 2026 Budget is still under discussion. 

Read More: 2025 Citywise AUM Rankings; Top 5 Cities Account for Over 57% AUM, Led by Mumbai! 

Conclusion 

With the pilot completed, the Department of Posts is now towards a phased expansion of mutual fund distribution through its nationwide network. The pace of the rollout will depend on employee training and certification. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.   
 
Mutual Fund Investments are subject to market risks, read all the related documents carefully before investing.