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Making Your First Mutual Fund Investment – Forms, Documents And Online Investing

Everything you need to know before you start investing.

Having decided whether to go with an advisor or distributor vs investing directly with the mutual fund, you’re now ready to make your first investment.

Options provided by Advisors & Distributors

  • paper application form & cheque
  • Online investment accounts

Options provided by mutual funds

  • Paper application form & cheque
  • Online investment

Paper application form & Cheque

This is the traditional way of investing and the most common one too.

Getting the form: Your distributor will provide you a form or you can download one from the mutual fund company’s website.

Filling up the form:

Please ensure that you fill the form correctly. Pay special attention to:

  • Bank details
  • Nominee details
  • Mobile number: you will get an SMS confirmation of the transaction. The best and fastest way.
  • E-mail: the mutual fund company will send you transaction confirmation as well as statements to this address. It’s best to fill it up in all caps

Please also note that SIP form is different from the one time investment form as it also contains an ECS Mandate allowing the AMC to debit your bank account every month

Payment: the form needs to be accompanied by a cheque for the amount of investment. The cheque is made out in the name of the mutual fund scheme. In case of a SIP, you need to provide a cheque for the first investment in addition to the ECS mandate.

Accompanying documents: the form needs to be accompanied by a copy of your PAN Card, copy of KYC acknowledgement

Submitting the form: Your advisor will usually collect the form from you and submit to the mutual fund company. If you invest directly, you need to submit the form to the nearest office of the mutual fund company or their RTA.

Confirmation: You will receive a confirmation when your investment is accepted by the mutual fund company. This will come in the form of an SMS to your mobile number and an E-mail. If you have not provided an E-mail address, you will get a statement by post.

Online Investment Accounts

Online investment options are much simpler because a lot of your paperwork goes away. You need to submit your documents only once and all investing and withdrawal instructions can be placed online.

Registering: You will need to complete a registration form and sign an investment agreement to open an account. This process may be done by you visiting the office of your distributor, an RM visiting you or online. Typically when you sign up online, a paper form incorporaing your details will be sent to you and you need to sign and send it in.

Investing: To invest, you have to go to the website of your preferred agent/fund website/trading platform and open an account. Once your account is opened, you will be emailed/couriered pre-filled application forms based on the data you provided during account creation.

Payment: Payment is made through 2 means

– ECS debit: The distributor will send your investment instruction to the bank and money will be transferred to the mutual fund company. This usually takes 3-4 working days.

– Payment gateway: After you specify your investment account, the online portal of your distributor will direct you to your bank’s net banking gateway and you will need to authorise the fund transfer. Payment gateway investments usually happen on the same day. You cannot use a payment gateway for SIP investments

– Direct Bank Account debit: If your distributor is also a bank, then whenever you invest through the online route, your bank account gets debited directly.

Choosing between Online & Offline investing?

While both methods have their pros and cons, it’s better to invest online due to one time & minimal documentations processes and ease of tracking your investments.

Online distributors will also give you additional benefits like single-view of investments across all mutual funds, portfolio tracking, portfolio rebalancing and more.

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