Direct plans of MF schemes have been gaining traction over the last few years. Till about a few years ago, you had to go to individual AMC websites if you wanted to invest in direct plans of MF schemes. That meant remembering or noting down many user ids and passwords.
There was a need for direct mutual fund websites which could let you invest in direct plans of MF schemes from different AMCs. Fortunately, many such portals have come up over the past couple of years.
Of the many portals discussed above, MF Utility is my preferred portal for MF investments. I manage my own MF investments on MF Utility. Additionally, I advise my clients to also get onboard MF Utility.
In this post, I will write about to how you can get started with MF Utility.
What is MF Utility (MFU)?
MFU offers a transaction portal for MF distributors, investors and Registered Investment Advisers (RIAs). MFU is owned by 25 participating AMCs. All major AMCs are part of MFU.
From the perspective of investors, MFU lets you invest in direct plans of MF schemes from multiple AMCs from a single interface. You can make purchases, redeem units, set up and cancel SIPs in MF schemes from different fund houses from a single interface.
So, you do not need to register on different AMC websites to invest in direct plans online.
By the way, MFU works in offline mode too where you submit physical forms at MFU Points of Service.
You can also invest in regular plans of MF schemes through MFU. Either your distributor can originate transaction for you or you can enter his ARN at the time of initiating a transaction.
The focus of this post is Investment in Direct plans of MF schemes online.
Benefits of MF Utility
- The platform is free of cost.
- You can invest in direct plans of MF schemes.
- You can invest in schemes from multiple fund houses from a single interface.
- You can get a consolidated view of your investments across MF industry.
- A SEBI Registered Investment Adviser (RIA) can originate transactions for you. You will have to approve transactions before those are executed.
- Once you register, the entire investment process is paperless. No issue of typo errors and signature mismatches.
What is Common Account Number (CAN)?
At MFU, everything begins with CAN (Common Account Number).
CAN is a unique reference number issued by MFU for a unique combination of
- Number of investors
- Order of holding
- Mode of holding (individual, joint, anyone or survivor)
- Status (Resident, NRI-NRE, NRI-NRO etc)
Clearly, many permutations and combinations are possible. So, you can have multiple CANs.
For instance, there will be separate CANs generated for:
- Individual holding for you
- Individual holding for your spouse
- Joint holding with spouse with you as the Primary holder in Joint operation mode
- Joint holding with spouse with your spouse as the Primary holder in Joint mode
- Joint holding with spouse with you as the Primary holder in Anyone or Survivor mode
- Joint holding with spouse with your spouse as the Primary holder in Anyone or Survivor mode
And yes, you will have to fill separate CAN registration forms for each CAN.
Once CAN is created, it automatically maps the existing folios under the same PAN, holding pattern and mode of holding with participating AMCs.
Therefore, you get a consolidated view of your investments across all the participating AMCs.
How do I register with MF Utility?
CAN (Common Account Number) can be issued to you only if you are KYC compliant.
If you are an existing investor, you must already be KYC compliant. You can find out if you are KYC compliant on CVL website.
If you are already KYC compliant, you need to submit the following documents to MFUtility.
- Completed CAN Registration form
- Completed PayEezz Registration form
- Self Attested Copy of your PAN Card
- Self Attested Copy of KYC Acknowledgement letter (a simple printout from CVL website will do)
- Cancelled Cheque (cheque should have your name printed on it)
Please note you may be required to submit a few additional documents if you are a non-resident (NRI). The details about the documents required are specified in the CAN registration form.
PayEezz registration form is a one-time ECS/NACH mandate for debiting bank accounts. PayEezz registration is necessary if you want to do SIP transactions.
In you plan to open a joint account, you need to submit KYC and PAN details of joint holder too. Cancelled cheque must have name of the primary applicant.
If you do not have cancelled cheque copy, you can submit a copy of bank statement or bank passbook or a letter from bank stating your account number.
Update: You can now create CAN online instantly. Discussed later in the post.
Do I need to visit any office to submit these forms?
No, you can mail these documents to MF Utility office in Thane and you are good to go.
Alternatively, you can visit the nearest point of service (POS) of MF Utility to submit these forms. CAMS and Karvy branches act as point of service for MF Utility.
Typically, you will get CAN within 5-7 days. PayEezz registration will take another 3-4 weeks.
What if I am not KYC compliant?
You still need to provide aforementioned forms with the exception of KYC acknowledgement letter.
You need to get KYC compliance done. KYC requires in-person verification.
Though there are ways to get KYC done online, it is better to visit nearest CAMS or Karvy office with filled in KYC form and KYC documents. You can submit MFU documents at the same time.
Points to Note
- So, you can have more than one CAN. For instance, you have one CAN for individual holding, while you can have a second CAN for joint holding with your spouse.
- For NRIs, there will be two separate CANs for NRO and NRE accounts. You will have to submit two CAN registration forms if you want to make investments through both NRE and NRO accounts.
- You can link multiple banks with the same CAN.
- Submission of PayEezz form is not mandatory. MFU will still create CAN for you. You can make payment for your purchases through net banking, NEFT or RTGS. However, you will not be able to initiate SIP transaction unless you have submitted PayEezz form.
- You will have to send a separate PayEezz form for each bank account that you want to enable for SIP transactions
- It is necessary that you send PayEezz form at the time of CAN registration only. You can send it later too.
- All the bank account holders need to sign the PayEezz mandate form.
How do I get online access to MFUtility?
You do not get online access by default.
Sounds bizarre. However, do understand MF Utility is an industry initiative and thus needs to balance many participants.
You have to request online access. Once CAN is created (you get e-mail or SMS about CAN creation), you can drop an e-mail to MFU (clientservices[AT]mfuindia.com) requesting for online access.
You will get login credentials within a few days. You can go to the following website to start investing through MFU.
You will be able to view investments made through other modes say, through distributors or other online portals. You can even redeem those units through MFU.
Point to Note: Even though you may have multiple CANs, you need to request online login details just once. Online details are provided on PAN basis (and not CAN basis). Once you log in, you can check all the CANs (linked to your PAN). You can select the requisite PAN and initiate transactions.
A SEBI Registered Investment Adviser (RIA) or a fee-only financial planner can also originate transactions for you in direct plans of MF schemes. You will get an approval mail and the transaction will be executed only after you approve the transaction mail.
Things to keep in mind while filling CAN and PayEezz registration forms
Though the forms are quite simple and there are clear instructions on how to fill the forms, there are a few things that you must keep in mind.
- PayEezz form will require you to enter CAN. However, if you plan to submit PayEezz form along with CAN registration from, you won’t have CAN at the time of filling PayEezz form. You can leave CAN details blank.
- All the details about bank account (such as IFSC, MICR) are present on the cheque leaf. You can find out such details on the internet.
- In PayEezz form, the amount to be entered is the maximum that your bank will allow you to debit per day. Hence, fill the form accordingly. If, in doubt, opt for a higher number.
- In period (PayEezz form), do enter how long you want debit mandate to continue. The best is to Check Until Cancelled.
Updated December 18, 2016
Now you can open CAN online (eCAN Facility)
MFU has recently allowed opening CAN online. Hence, there is no need to fill CAN Registration form and courier to MFU office in Thane or submit at CAMS or Karvy centers.
You can visit this link to create CAN online. You can fill out all the details online and you will be allotted a provisional CAN instantly.
Subsequently, you will get an e-mail from MFU where you will be asked to upload a few documents. I opened CAN (anyone or survivor) with my wife and I was asked to upload scanned copies of PAN card and cancelled cheque. Your CAN will be activated after verification of uploaded documents.
Once your CAN is activated (and after you receive online access), you can transact in mutual funds online.
Do note only creation of CAN is online. For registering PayEezz (which is mandatory if you want to initiate SIP transactions), you still need to follow offline process.
Both CAN and PayEezz registration can now be done online.
However, not everybody can create CAN online. There are the following pre-conditions.
- You must be KYC compliant. AND
- You must satisfy one of the following conditions.
- You should be an existing investor in any of AMCs participating with MFU and the bank account (provided while filling eCAN form) should be registered with any existing MF folio.
- You should not have any investments in AMCs participating in MFU.
As I understand, either you should be a new investor. Or else if you are an existing investor with participating AMCs, your bank account should be registered in atleast one of the folio.
Investors who do not satisfy this criteria can still open eCAN but they will have to submit documents physically. However, the entire purpose of opening CAN online is defeated in that case.
Now PayEezz Registration can also be done online [Update: March 19, 2018]
Even PayEezz registration can now be done online. Instead of the timeline of 3-4 weeks in case of physical forms, the online registration process takes only 2-4 days. For more on this, go through this post.
The post was first published on July 2, 2016 and has been updated since.