Why AMFI blocked fintechs’ access to investor data: A look at the concerns and impact

The Association of Mutual Funds in India (AMFI) has directed MF Central to suspend the sharing of investor portfolio data with third-party platforms, following complaints from mutual fund distributors about client poaching by fintech firms, people familiar with the matter told Business Today. 

MF Central, jointly operated by CAMS and KFintech, was launched in 2021 as a one-stop solution for mutual fund investors, offering a consolidated view of their holdings. Its API framework, enabled through OTP-based investor consent, allowed third-party platforms to access portfolio data for a fee. 

For fintechs, this data was central to their offerings — powering dashboards, portfolio analytics, and personalised recommendations. For investors, it meant seamless, all-in-one access. 

Why the stop? 

According to industry sources, AMFI’s action was triggered by two key concerns: 

• Distributor pushback: Traditional mutual fund distributors were wary that fintechs were using the data to “poach” their clients. 
• Data misuse: A newly-launched fund house reportedly obtained bulk access, raising red flags about the potential for aggressive marketing or unfair competitive advantage. 

What about fintechs? 

With APIs disabled, fintechs now face limited alternatives. They can either request investors to manually upload their consolidated account statements (CAS) — a tedious process that undercuts the digital experience — or pivot to the Account Aggregator (AA) framework, which regulators are advocating as a long-term solution. 

However, the AA framework is still maturing. It currently provides only two years of transaction data and is accessible only to SEBI-registered RIAs and PMS players, excluding distributors. 

Why is this important? 

Investor transaction data is among the most valuable assets in financial services. Whoever controls access to this data also controls investor engagement, advice influence, and distribution revenue. 

The API freeze threatens to slow innovation among fintechs and reduce convenience for digital-first users. For legacy distributors, however, it protects existing relationships. 

“Data should not leak to third parties. Approvals must come with explicit knowledge and acknowledgement of the investors, as sometimes investors don’t realise what they’re consenting to,” said a senior mutual fund official. 

Shifali Satsangee of Funds Ve'daa in Agra added: “Some fintechs were pitching free portfolio reviews mainly to millennials, but this is effectively poaching clients. Large distributors had every reason to push back.” 

CAMS, AMFI, and KFintech declined to comment. 

The move has triggered a broader industry debate: 

1. If investors provide OTP-based consent, should their ability to share data be restricted? 
2. Is this really about privacy—or about neutralising fintech competition? 
3. Will the industry shift toward the nascent AA framework, or will AMFI propose a middle path? 

For now, the suspension has reshaped the data-sharing landscape. But the bigger question remains: who truly owns investor data—the investor, the ecosystem, or its intermediaries?