This article will discuss the best finance business at low investment in India.
The finance industry is vast and advancing daily. Many aspiring entrepreneurs consider it a promising sector in which to start their entrepreneurial journey.
That said, there are many small business ideas in the finance industry. While few businesses require minimal investment, few do not require any.
These businesses can be pursued as a side hustle to earn extra income or turned into a full-time career.
Whatever you choose to do, we are here to help you. We have covered some of the best small business ideas for you here. Keep reading!
Best Small Business Ideas in the Finance Industry
Lately, people have been showing great interest in entrepreneurship. While there are many industries to choose from, the finance industry seems to have a promising future.
This article has illuminated the best small business ideas in the finance sector. Our primary focus is on the stock market, sub-broker business models, mutual fund business, insurance, etc.
You are on the right page if you are interested in the finance sector. Get inspiration from our small business ideas in finance and start your entrepreneurial journey.
Here are the top business ideas in the finance sector.
- Sub Broker Franchise
- Mutual Fund Distributorship
- Stock Market Advisor
- Stock Broker Partner Program
- Insurance Agent
- Direct Selling Agent (DSA)
- Referral Program
So, without further delay, give these business ideas a read!
Sub Broker Franchise – Best Finance Business Ideas at Low Investment
A subbroker franchise is one of the most popular business models in the finance industry. Whether you are a newcomer or an experienced, this is a great business to start.
In this model, the sub-broker acts as an agent for the brokerage firms. As a sub-broker, he sells their products to the clients.
He earns a commission by selling their products to the clients. He also helps and guides clients in their financial decision-making.
We have discussed the investment, commission, earning potential, support, etc., of this business to help you understand this model better.
Investment required from Sub Broker
The first step to becoming a sub-broker is to register with SEBI. The registration fee ranges from Rs.50,000 to Rs. 1 lakh.
After successful registration, the sub-broker must sign an agreement with the firm. While some brokers offer free registration, few request a security deposit.
However, the security deposit is refundable. It usually ranges from 1,00,000 to 3,00,000 rupees. Nevertheless, the security deposit is different for all firms.
Commission earned by Sub Broker
The sub-broker earns a decent commission from stockbroker firms. The commission is based on the number of transactions performed by the client.
Some firms offer 70% of the brokerage to the sub-brokers, while the minimum commission starts at 30%.
In short, the more clients and trades a sub-broker performs, the more commission he earns.
Factors such as the number of trades, service type, and segments significantly affect the commission percentage.
Earning Potential of Sub Broker
A sub-broker usually has high earning potential. As knowledge about investments increases, so does the earning potential.
Now, the sub-broker can earn more if he brings in more active clients. Moreover, the revenue generated also adds to the earnings.
Also, the affiliated stockbroker increases the sub-broker’s earning potential.
Support provided to Sub Broker
In this business model, the stockbroker provides valuable support to the sub-broker. For instance, they offer trading platforms to simplify the transactions.
The sub-broker executes the orders on the client’s behalf using these platforms. The broker also provides back-office support to the sub-brokers.
Sub-brokers also receive help with KYC verification, account opening, fund transfer, and other tasks.
The firm also provides training and development support to the sub-brokers, which further helps them improve their skills in the stock market industry.
Top 3 Brands in Sub Broker Business
Considering the pros and cons of all the stockbrokers in the industry, we have cumulated the top 3 brands. Motilal Oswal stands first, followed by Sharekhan and IIFL.
You can contact any of these brands to get started as a sub-broker.
Mutual Fund Distributorship – Top Finance Business Ideas at Low Investment
Our next small business idea is mutual fund distributorship. This is one of the most booming businesses in the world of finance.
Mutual fund distributors sell products to consumers and guide investors in choosing the right products.
Mutual funds’ best feature is their high returns, so most investors consider them a potential investment option.
Let’s look at this business model’s investment, commission, earning potential, support, etc.
Investment required from Mutual Fund Distributor
Becoming a mutual fund distributor is easy. Also, it does not cost much to start the MFD business. There is no exact investment required to be an MFD.
However, you must pay the NISM certification fee, which ranges from Rs.15,00 to 2,000. There is also an AMFI registration fee, which could be around Rs.3,000 to 5,000.
In addition, if you have qualified for the NISM exam, you must set up the office. This may cost between Rs.5,000 and Rs. 20,000.
Depending on the sale of your business, you must choose your office setup. For example, if you want to set up an office with minimal infrastructure, it could cost around Rs.20,000 to 30,000.
So, the minimum investment required to start an MFD business would be between Rs.30,000 and Rs.50,000.
Commission earned by Mutual Fund Distributor
The MFD sells the funds and earns a commission ranging from 0.1% to 2%. The AUM pays the commission to the MFD. However, the commission varies from scheme to scheme.
Earning Potential of Mutual Fund Distributor
The MFD can earn a significant amount if his client base is solid. Also, the earnings will be promisingly high if they are associated with a big mutual fund house.
This business model’s initial income is low. However, with an increasing client base, MFDs can make substantial income.
Roughly, a well-established MFD can earn around Rs.5 lakh to 10 lakh annually.
Support provided to Mutual Fund Distributor
In this business model, the national distributors support the MFDs. This support includes backend support, software support, and free backend platforms.
Additionally, they provide advisory support, account opening support, and training/marketing support.
Despite providing all these services for free, the distributors will not charge the MFDs any distribution or annual maintenance fees.
Top 3 Brand offers Mutual Fund Distributorship
The top three brands in the mutual fund distributorship business are Motilal Oswal, Sharekhan MF, and IIFL.
To start your career as an MFD, connect with these top brands. Before getting started, discuss everything clearly with the brands.
Stock Market Advisory – Best Low Investment Finance Business
The Indian stock market is vast, and there are plenty of opportunities for stock market enthusiasts. Those who want to start a career in the stock market industry can join this program.
With the ever-increasing demand for stocks, the need for advisors has increased significantly. This, in turn, increased the demand for stock market advisors.
To start your career as a stock market advisor, first learn about this program’s commission, earning potential, investment, support, etc.
Investment required from Stock Market Advisor
Starting a stock market advisory business requires an initial investment. First, the individual must register with SEBI, which costs around Rs.10,000.
After registration, the individual must get a certification for the NISM series exams. The exam fees would be approximately Rs. 2,000.
After qualifying for the exam, he can operate the business from home. Otherwise, he can rent an office space, which costs a minimum of Rs.10,000 per month.
After setting up the office, the stock market firm provides free software tools. These tools help the advisor effortlessly manage stocks and exchanges.
If the firm does not offer software tools, the advisor must invest in them. The cost of the tools would range from Rs.10,000 to Rs. 30,000.
Also, to increase the business’s reach, the individual must use digital marketing strategies. So, the investment required to set up this business would be between Rs.1 lakh and Rs.5 lakhs.
Moreover, the investment amount increases with the company’s scale.
Commission earned by Stock Market Advisor
The company pays stock market advisory a commission in exchange for services received. Generally, the commission is 1% to 2% of the value of the assets.
In addition to the commission, the agent gets a flat fee for the services offered. Besides these commissions and expenses, there are some hourly rates for the advisory agents.
In some cases, the agents charge fees based on their performance.
Earning Potential of Stock Market Advisor
In this business model, the advisory agent earns a lot. The agents mainly make money through commissions.
The secondary source of income is through asset management. They also earn through subscriptions, consultation fees, referrals, etc.
Moreover, earnings will be high if the business is significant. For example, a small-scale advisor makes around Rs.5 lakhs to Rs.10 lakhs annually.
However, a large-scale advisor makes a more decent amount annually.
Support provided to Stock Market Advisor
The affiliated firms offer extensive support to the stock market advisory agents. The primary support starts with training and development.
The secondary support comes with regulatory compliance. Lastly, the firms offer branding and technology support to the agents.
Famous firms also provide advisory agents access to research and analysis reports.
Top 3 Brands in Stock Market Advisory
Motilal Oswal, CapitalVia, and Sharekhan are the go-to brands for stock market advisory. These brands are named for offering clients the best stock market advisory services.
So, if you want to start your career in this field, contact these brands for assistance right away!
Stock Broker Partner Program – Best Fintech Idea at Zero Investment
The stock broker partner program is another of the best small business ideas in finance. Anyone with good knowledge of the stock market can try it.
Also, a person with a good network of friends can quickly start and succeed in this business.
Whether you are a beginner or experienced, you can begin a partnership program with any stock broker firm in the industry.
You can even do it as a side hustle and create an additional source of income for yourself.
Investment required to become a Stock Broker Partner
To become a stockbroker partner, the partner does not need to make any initial capital investment. Most stockbroking houses do not charge anything from the partner.
So, with zero investment, an individual can join the partner program with any stockbroker.
Commission earned by Stock Broker Partner
The stock broker partner starts earning a commission when the client begins investing. The commission is a part of the brokerage fee.
The partner earns a commission for each successful client transaction. The client also shares some percentage of the various trades performed.
The stock broker usually offers a commission of 20% to 50%. The commission changes with the type of partnership model chosen.
Earning Potential of Stock Broker Partner
The stock broker partner’s earning potential is decent. The earnings come through revenue sharing, brokerage fees, and rewards.
He can also earn well by selling diverse investment products and increasing his profits by bringing more active clients on board.
Support provided by Stock Broker Partner
The firm gives its partners free marketing support and assigns them a dedicated relationship manager. The firm also provides free marketing materials and personalised support.
Some stockbrokers even offer 24×7 online support to their partners. The support includes servicing, products, queries, etc.
A partner can also get training marketing materials from the firm. Most companies provide their partners with access to technology platforms. The platforms help partners speed up their jobs.
Top 3 Brand offers Stock Broker Partner Program
The top 3 brands that offer the best stock broker partner program are Angel One DRA, Motilal Oswal Digi Partner, and Upstox Partner.
These are SEBI-registered stock broking platforms in India.
Insurance Agent – Top Low Investment Finance Business Ideas
Becoming an insurance agent is another of the best small business ideas in finance. The first step is to register with the insurance company.
After registration, the agent should get the required training from the company. Lastly, he has to take the exam and qualify for it.
The qualified individual can start their business as a licensed general insurance agent. The insurance agent works with insurance companies and sells their products to clients.
After understanding the client’s requirements, the agent suggests the right insurance plan. The agent sells the products to the clients and makes money.
Investment required from the Insurance Agent
No investment is required to start as an insurance agent. Instead, you have to invest your time and effort into it.
Also, you have to get the necessary training and clear the exam to be an official insurance agent. The only investment you have to make is to pay the examination fee (if any), which is almost negligible.
Commission earned by Insurance Agent
There are various insurance categories, such as health, bike, car, and business. The agent earns a commission if he sells any of these policies.
A percentage of the commission is deducted from the premium a policyholder pays. The minimum commission an insurance agent receives is 10%.
Again, the insurance company decides the commission, which varies from company to company. The commission percentage is also chosen by the type of insurance policy and its size.
In addition to this general commission, the company also gives a 5% renewal commission.
Earning Potential of Insurance Agent
The earning potential of an insurance agent is high. With the increasing demand for insurance policies, the market for insurance agents has increased drastically.
The potential earnings can go up to Rs.50,000. It may even go above that if the agent sells more policies. Also, if the client onboards more clients, it adds to the earnings.
Support provided to the Insurance Agent
Insurance companies provide excellent support to their agents. First, they offer training. They also conduct development programs, such as seminars and workshops.
Most companies offer access to dedicated apps and software. These tools and apps help handle multiple clients and their policies easily.
To encourage the agents, the insurance companies give rewards and awards. Companies also offer bonuses based on the agents’ performance.
Top 3 Brand offers Insurance Agent Program
ICICI Prudential Insurance Company is the number one brand in the insurance sector.
HDFC Argo Insurance Company stands second, while Ageas Federal Life Insurance Company settles for third place in our list.
DSA (Direct Selling Agent) – Best Finance Business ideas at Zero Investment
The Direct Selling Agent (DSA) sells financial products directly to clients. He carries out tasks for both customers and financial firms.
He also finds out customers’ requirements and makes product recommendations accordingly.
Furthermore, he conducts thorough research on the product range available with the firms. He even helps clients with the application process.
Moreover, a DSA can help customers easily reach the lender for a loan.
Investment required from DSA
The DSA business model also requires no investment from the agent. However, the DSA must have an excellent network to sustain the business.
Also, a deep understanding of how the business works is essential.
Commission earned by DSA
A DSA can earn a decent amount through commissions. The more loans they sell, the more commission they make.
They usually receive a commission of 0.30 to 0.50% on a successful loan disbursal. However, the commission is not the same for all types of loans.
For example, the DSA’s commission on a home loan, one of the most popular loan types, is 0.25% to 1% of the loan amount.
Earning Potential of DSA
The earning potential of a Direct Selling Agent depends on various factors, including the firm, the type of loan, and the number of active clients.
A DSA’s primary earnings are from commissions. They also make monthly earnings based on the number of active leads generated.
The loan size also greatly impacts their earnings. To encourage them, firms provide bonuses to the best-performing individuals.
Support provided by DSA
Renowned financial institutions offer free training to their agents. They provide basic training on products, interest rates, etc.
They also teach you how to network and sell, provide ongoing support through workshops and seminars, and offer access to free online resources.
Top 3 Brand offers DSA
The top 3 brands that provide the best DSA services are HDFC Bank, Kotak Bank, and Bankbazaar. If you want to be a Direct Selling Agent, contact any of these brands and get started.
Referral Program – Best Small Business Ideas in the Finance Industry
Last, a small business idea in the finance industry on our list is a referral program. In this mode, the individual must refer friends and family to the business.
That way, he earns a commission. The more referrals he makes, the more commission he earns.
To expand the business fast, the individual must build an online presence and network with more clients.
Investment required from Referral Partners
There is no need for investment to start a referral program. However, if the partner wants to take the business to the next level, he can invest in referral software or rewards.
In most cases, the financial firm will provide the software for free, so there is no need to invest in this business.
Commission earned by Referral Partners
The financial firm itself decides the referral commission. The more referrals the partner brings, the more commission he earns.
However, only active leads generate commission. The firms give individuals 10% to 30% commission. The referral partner also earns recurring revenue of 5% to 15%.
Earning Potential of Referral Partners
In addition to the commission, the referral partner earns a flat fee. The fee is given per customer and decided based on the product size.
Companies also provide performance bonuses to individuals. They also get incentives from the firm now and then.
Support provided to Referral Partners
The referral partners don’t usually receive support from the financial firm. However, they do receive bonuses, incentives, cash rewards, etc.
So, if you choose this business as your career, be ready to stand independently without expecting help from the firm.
Top 3 Brand Offers Referral Program
Angel Broking’s refer-and-earn program is number one on our list. The IIFL referral program follows it. The third on our list is Zerodha’s refer-and-earn program.
These brands are known for offering ultimate refer and earn programs for the interested.
Top Finance Business at Low Investment – Conclusion
Well, these are the best small business ideas in the finance industry. We hope you found your favourite business idea from our list.
All these businesses are profitable, but you can only succeed if you work hard and understand the business models closely.
This article will help you make a sound decision about whether to proceed with the business. If you plan to start your entrepreneurial journey, refer to it.
We have also shared the top brands in the market. You can easily contact them, talk to them, and clarify doubts.
Also, you can begin making significant earnings by starting as an entrepreneur.
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