Direct plans of mutual fund schemes offer better returns than regular plans. This aspect of mutual fund investing is not lost on many. However, a lot of people find it cumbersome to visit nearest mutual fund offices for every new AMC (Asset Management Company or mutual fund house) they want to invest with. I have mentioned in many of my earlier posts that you need to visit AMC office (mutual fund branch) at least once. However, this requirement is no longer true. You do not need to visit nearest AMC office to invest in direct plans of mutual funds. If you are comfortable with online transactions, you can invest online. There is no need to visit AMC office to invest in direct plans of mutual funds. Even first time investors with the fund house can invest in direct plans online.
What do you need to invest in Direct plans online?
Most AMCs allow you to make investments online. You just need the following:
- You need to be KYC Compliant.
- You should have access to net banking
- And yes, you should be comfortable with online transactions.
You don’t have to submit any proof for KYC compliance. AMC finds it out itself based on your PAN. You need net banking to make payment for purchase and register for SIPs (systematic investment plan).
Go through this post to understand why you should invest in direct plans of mutual funds scheme. For common doubts investors have about direct plans of mutual fund schemes, please go through this post.
How to check if I am KYC compliant?
If you have already invested before with any of the fund houses (AMCs), you will be KYC compliant. Otherwise, the fund house would not have let you invest with them. Or else you can go to following links
You just need to enter your PAN number to find out if you are KYC compliant. If you are KYC compliant, you are good to go. You can visit the AMC website and invest in direct plans of MF schemes online.
What if I am not KYC compliant?
The process is simple.
- You can download KYC form from any of the AMC or KRA (CVL, CAMS etc) website.
- Fill up the form. You need to provide self attested copies of ID proof, address proof, PAN card and photograph
- Submit the form along with the self attested copies to nearest AMC office, RT agent (such as CAMS and Karvy). Do carry the original documents for verification.
In a few days/weeks time, your KYC status will reflect in the two websites mentioned above.
Once you are KYC compliant, you don’t have to repeat this exercise.
What about e-KYC?
Some AMCs such as Reliance MF and Quantum AMC have started e-KYC services for the first time investors. Reliance MF e-KYC still requires some documents to be mailed to their office. Quantum AMC e-KYC does not require you to mail any documents to their office. Under e-KYC, you are required to upload ID proof, address proof and PAN copy. In-person verification (electronic) is done through video conferencing.
Please understand e-KYC is meant for those who are not KYC compliant. If you are already KYC compliant, you don’t have to do e-KYC. Additionally, once you finish e-KYC with Quantum AMC or Reliance MF, you can invest with other MF houses too.
Can I even start SIPs in Direct plans online as a first time investor?
Yes, you can. When you register for SIPs on AMC website, you will be issued a Unique Registration Number (URN). You can go to Biller or Utility Payment or Manage Biller section and register the fund house as biller using the URN. And you are done. The SIP amount will get debited automatically (periodically) and get invested in the selected mutual fund scheme.
Funds (AMCs) where you can invest online
Please note I am talking about AMCs where you are the first time investor. If you are an existing investor, all fund houses allow you to transact online. If you are an existing investor (regular plans) with the AMC, you can invest in direct plans of the funds online from the respective MF websites.
I tried to invest with following fund houses (as a first time investor). With one of the AMCs, I actually invested (in my wife’s name). With the other fund houses, I dropped the transaction after reaching the payment page.
ICICI Prudential Mutual Fund: New Investor Link
Franklin Templeton India: New Investor Link
Axis Mutual Fund: New Investor Link
Quantum Mutual Fund: New Investor Link
For the remaining fund houses, I did not try. You can try out on your own. I am sure most AMC or fund houses allow you to invest with them online (even if you are a first time investor with them). Do remember to select Direct Plans while investing. If any mutual fund house does not provide such facility at the moment, I am not sure it will in the next 6-12 months. No fund house can afford to be behind competition.
Here are some of the ways you can invest in mutual funds.
- Contact your local distributor and invest in Regular
- Open account with online portals such as ICICIDirect, FundsIndia and Scripbox. Invest in Regular Please understand local distributors and online portals are not evil because they make you invest in regular plans. They need to be compensated for the convenience and advice they offer.
- Go to a bank and invest in Regular Plans. Avoid this channel. From what I have seen, bank officials are least equipped to offer mutual fund investment advice.
- DIY (Do it yourself) investors can invest in Direct plans online or by visiting nearest AMC branch.
- Contact SEBI Registered Investment Advisors for MF advice and invest in Direct Plans online or by visiting nearest MF branch.
- Open account with MFUtility and invest in Direct plans across mutual fund houses. Unfortunately, investors cannot invest online in direct plans as yet. At the moment, they can invest in offline mode.
If you understand the benefits of investing in direct plans of mutual funds, then don’t wait. Don’t wait to visit the nearest AMC branch if you are a first time investor. Don’t wait for MF Utility to offer investments in direct plans (online). Get your net banking login details ready and start investing in direct plans of mutual fund schemes.
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43 thoughts on “Invest online in Direct Plans of Mutual Fund Schemes”
One very convenient approach i follow is to use CAMS online. They have come up with a mobile app which allows investing/redemption/switching through smartphone.
Very useful observation. Thanks Atul for pointing this out!!! Agree CAMSOnline is a good way. The last time I checked with them they were still rectifying the glitches. At the time, you could invest (through CAMSOnline) with AMCs where you were an existing investor and not with a new AMC. It was a technical issue and they had told me that they would sort it out in a few months. Hope they have sorted out the issues. Just one limitation, CAMSOnline will let you invest in funds that are serviced by CAMS.
Thanks again for pointing this option to the readers!!!
This is really good stuff. Thanks Deepesh
Thanks Pankaj. Glad you liked the post.
Hi Deepesh
I went through the above guidelines and found them really useful. However, I wasn’t able to understand couple of things
1) If through online mode I start with a monthly SIP of XXXX amount, will it be possible to change that amount in a new fiscal/calendar year? Or, in other words, how many times we can change the SIP (if I want to increase my SIP by 10% every year) for a period of 10 years.
2)If in any unfortunate circumstance I need to close a SIP permanently, will it result in the loss of entire amount I have deposited until a date? Is there a period, before which, if we close a SIP the entire amount gets forfeited?
It will really be great if you can help me with these.
Hi Pankaj,
1. Instead of changing the SIP amount, You can cancel the existing SIP and start a new SIP with a different amount. You can do this any number of times.
2. You don’t lose anything by stopping a SIP. The MF units purchased through earlier SIP installments belong to you until you sell the units. SIP is merely a way to invest in mutual funds. You can stop whenever you want. You don’t have to forfeit anything.
Thanks Deepesh, these were really helpful. I’m all set to go.
Hi Deepesh,
I am a first time investor & wanted to invest in Axis Long Term Fund – Direct. Also, in near future i want to invest in some other funds as well. So, what will be best approach for me to do it online (including registration). Is there any single point from where i can do the registration & also do the monthly SIP transactions as well.
Thanks,
Shrikant.
Hi Shrikant,
You need to complete KYC before you start investing.
There are many ways:
1. Go to Axis MF branch (and not Axis bank branch) and start SIP.
2. Visit nearest CAMS or Karvy branch. Get your KYC done. Subsequently, you can go register on Axis MF website and transact from there. Typically, CAMS and Karvy ask you to invest in any fund. You can make a token investment. For Axis MF scheme, you would have to go to Karvy branch.
If you are looking to invest in direct plans of scheme from multiple funds houses, go with MF Utility.
For MF Utility, go to any MFU POS (typically CAMS or Karvy branches) and submit KYC, CAN registration and PayEezz registration forms. After your CAN (common account number) is generated, you can request for online access. Subsequently, you can transact in MF schemes from 25 different AMCs online from a single interface. Through MF Utility, you can purchase, redeem, create and cancel SIPs
Good day Deepesh,
Thanks alot for all your guidance.
I’m rele looking forwrd to initiate a professional relationship with you very soon.
Thanks alot for all detailed information. One thing which is too clear about you is that you give detailed and transparent information and I rele appreciate that.
Cheers!!
Best Regards-
Ahmed Dastani
Thanks Ahmed. Appreciate your kind words.
Hi sir
If I go for lumsum rs. 200000 then how many years can stay
Minimum?
Maximum ?
Pls suggest.
Thanks
If you are investing equity mutual funds, have an investment horizon of atleast 7-10 years.
Tie your investments to financial goals. You will know the answer yourself.
its really nice, Thanks alot for your guidance Mr. Deepesh. Things are clear and without any any bias. I was just tired of with these third parties.
You are welcome. Do share the post with friends and family.
Hi Deepesh,
In March’16 I choose to invest in mutual fund through SIP option via FundsIndia. Now the SIP is done for 2 months.
Can I stop the SIP and go for SIP through direct plan?
Will there be any charges for the amount paid for 2 months?
Could you please guide whether it is better to stop SIP through FundsIndia and go through direct plan?
Hi Raghavendra,
You can stop SIP. There are no charges for stopping SIP.
Stopping SIP does not mean you are exiting investment. It is just that the future installments of SIP will be stopped. Units purchased with prior installments will not be automatically redeemed.
FundsIndia gets you invested in regular plans. So, if that’s the only criterion, you should stop SIP with FundsIndia and start SIP in direct plan.
Hi Deepesh,
I am an existing investor in SIP. My SIP has ended in feb’16. Can I start another SIP ONline ? Currently I am in USA , can I still invest in SIP online ?
Thanks and Regards,
Minal
Hi Minal,
You can start another SIP online. That is not an issue.
However, since you are in US, FATCA provisions may apply and AMC may refuse to accept investments from you.
If you are a US based NRI, then the AMC will not accept investments from you.
Please go through the following post for more on FATCA laws.
http://capitalmind.in/2015/11/what-is-fatca-and-should-you-care-that-its-not-really-a-weight-loss-program/
Guess only Sundaram and L&T mutual funds are accepting investment from US based NRIs.
Thank you. Will check for FATCA law.
Sir
I’m 42 years old with an annual income of 15 Lakhs. A Non-government employee
I have started sip in following 4 mutual fund schemes in June 2016. Each one is Rs. 2000/- p.m for 10 years. All are Regular scheme. Investment is through my Demate a/c.
1. SBI Bluechip fund
2. L&T India Value fund
3. Franklin India Smaller companies fund
4. DSP BR Micro cap fund
I also joined in NPS for Rs.4200/-p.m with HDFC pension fund.
I’m planning to start SIP with following funds also. Each one with Rs. 2000/- p.m. deposit
1. Franklin India Prima plus
2. ICICI Prudential Value Discovery
3. Mirae Asset Emerging Bluechip
4. HDFC Balanced fund
Will you pl answer my following queries
1. Is my portfolio selection need any correction? ( Looks like 23% of the allocation is on Banks)
2.Should I do Direct scheme or continue with Regular scheme?
3. If I start Direct schemes for my new funds and switch the existing funds to Direct schemes. Can I mange my whole portfolio through Karvy or CAMS online?
4. Can I change my monthly instalment in between or temporarily stop SIP if market is very high? Or buy additional units if the market fall? (Flexi SIP). How much time will it take for such a change?
Expecting your valuable reply
With best regards
Santhosh Sahadevan
Cochin
Hi Santosh,
The choice of funds is good per se. I assume you are investing for the long term.
Just that you have too many funds.
1. Benchmark indices have good weightage to banks. That’s why it reflects in your portfolio holding too. Don’t worry about it.
1. If you selected funds on your own, there is no need to invest in regular plans. Go Direct.
3. CAMS will give access to funds serviced by CAMS. Ditto with Karvy. I have not used CAMS of Karvy online interfaces beyond a point. The interfaces had some issues 6-8 months back. Not sure if those have been rectified.
4. Depends on the fund house. Typically you can’t. However, you can always stop existing SIP and start a new SIP. However, it is easier to maintain investment discipline if you are investing through SIP. More so for a new investor like you. If you want to buy additional units when the markets fall, you can do that in a lump sum transaction. Suggest you don’ disturb your SIP investments.
Hope this answers your query.
Good luck!!!
Thank you Deepesh for your detailed reply
Hi Deepesh,
Thank you for such a nice post. I am 24 year old earning about 29000 per month in a IT company. I am a first time investor and looking forward to experiment with SIP. I am already paying a premium of LIC Rs.17200 per year, 2000 per month in PPF. I don’t know what’s my tax structure is but my payslip says that I have a taxable income of Rs.291490 per year. Thought of ELSS fund i.e Axis Long Term Equity fund but I don’t know whether I have choosen the right plan as I am not able to understand the Tax exemption required as per my Taxable Income.
I would like you to guide me with a suitable SIP plan. I am looking out for a safer option.
Thanks in advance for your reply.
Regards,
Prasanth
Hi Prasanth,
The fund has done well over the last many years. You can continue.
Greetings Deepesh RAghaw,
Currently I have Rs.4000 per month in Axis Long Term Equity – Growth (ELSS) and I have Rs.1,50,000 limit reached in section 80C. I am planning to additionally invest Rs.4000 per month in any small and mid cap segment (sbi small and mid cap or any other better performing funds in this segment). I am confused whether there will be many charges on any other segments of mutual funds except ELSS. Kindly help me to choose whether to route additional Rs.4000 in ELSS or small and mid cap segment (sbi small and mid cap or any other better performing fund) based on the charges incurred like processing, effect of tax in case of non-ELSS during investment and selling. Awaiting your response.
Dear Cheeli,
ELSS is merely a variant of equity mutual funds. With ELSS, the only difference is that you get tax benefit under Section 80C for investment and the amount is locked in for 3 years. With other equity MFs, there is no tax benefit and there is not lock-in.
There are no charges specifically for non-ELSS funds. Taxation for ELSS and non-ELSS funds is exactly the same.
Personally, I wouldn’t invest in ELSS if I have already breached my Section 80C limit.
Hope this answers the question.
Thank you Deepesh Raghaw for clarifying
Hi Mr.deepesh,
Presently i am staying in gulf country. So presently i am NRI but not permenent. I want to invest in direct plans for 10000 ruppes per month in SIP. Please suggest me how to invest being NRI and suggest good funds
Dear Satya,
You will have to get KYC done and subsequently you can invest.
Though I have covered most details in the post, you can approach an AMC (mutual fund house) directly and tell them you want to invest in one of their MF schemes. They will guide you.
Please understand I offer investment advice on professional basis only. You can visit the offerings section for more details.
Thank you Mr. Deepesh
Hello Deepesh,
I want to invest Rs 5000 per month in SIP for 10-15 years period.Can you please guide me in which funds should I invest so that I can get better retuns.
Dear Immanuel,
Assuming you are a new investor, suggest you take exposure to a good large cap or a multi-cap fund.
You can avoid mid and small funds for the time being.
Sir,Thanks for your valuable suggestion.Accordingly I have selected some of the funds for SIP investment for 15 years such as SBI bluechip fund(1000 Rs),SBI magnum multicap(1000 Rs),Birla sunlife frontline Equity fund(1000 Rs) and ICICI Pru value discovery fund(2000 Rs). Kindly suggest if my funds mentioned above for 15 years tenure are good or need any change?
Thanks for your valuable time for sparing for me.
Decent funds. Go ahead with them. Good luck!!!
Hi,
Very nice articles
Have a question: I started investing in 2 mutual fund SIPs both regular plans from last 12 months.
1) I contacted the AMC & their representative collected documents from me. Why did he mis-sell me to regular plan instead of direct plan?
2) Assuming I have to change to direct plan, how can I do it online? (as of know I know that I can login to AMC website & I get monthly consolidated account statement from CDSL, so I believe my KYC is done). How can i sell & transfer funds to direct plans online with same AMC or different AMC?
Thanks
Hi,
1. Can’t say. Perhaps, they sent a distributor to your house.
2. Yes, you can do this online from AMC websites.If you are existing MF investor, your KYC is done.Do keep in mind capital gains and exit load implications.
hey Deepesh,
I have to invest 10000/month through s.i.p. will u please guide me suitable portfolio but under following condition
1. Only in SBI mutual funds.
2. Invest for 10 Years
3. Maturity amount should be approx 35Lakh
4. No tax deduction at maturity amount
5. 50% risk appeptite
Thanks
Dear Kunal,
Please understand I provide specific investment advice only on a professional basis.
Request you to visit Offerings section.
Hi Deepak,
I have not invested in MFs ever before, and your posts have been really helpful – thank you for that!
I am planning to invest in MFs using “MF utility” and wanted to know how can I use Flexi SIP or anything of similar sorts to invest more during the times when market are lower. I do not want to invest uniformly through the year, ideally I would not want to invest at all when markets are relatively high (of course, I understand the benefit of SIPs and the risk I will be exposed to by not using SIP and instead using my judgement to time market)
Regards,
Ronak
Dear Ronak,
You are welcome. Please do share the posts you like on your social media pages.
From MFU website, you cannot start Flexi SIP or something of similar sort.
In my opinion, do not expect such functionality from MFU in the near term. Such items are just not their priority.
If you wish, you can start such SIPs from AMC websites (AMC must offer such facility).
In my opinion, Flexi SIP etc are much ado about nothing. Nothing more than a marketing trick. You can do opportunistic investing on your own.
Btw, investing in mutual funds through SIP does not reduce the risk.
Dear Sir,
I want to invest in mutual funds for long term (7-8 years). I am new investor and ready to take moderate risk. I plan to invest (direct plans) monthly SIP of Rs. 8,000 – distributed among the below mentioned funds in the given ratio:
1) ICICI Prudential Value Discovery Fund (Multicap) – 30%
2) Birla Sunlife Top 100 ( Largecap) – 20%
3) HDFC Balanced Fund (Hybrid Fund) – 15%
4) Mirae Asset Emerging Bluechip Fund – 35%, and
5) Lumpsum investment of Rs. 25,000 in L&T India Value Fund.
Is the above selection and ratio correct or should I invest in some other funds (say SBI Magnum/DSPRock)?
Also, can you suggest some funds for short term investment to keep the idle money for 3-4 months and earn the return.
Kindly advice.
Hi Dimple,
Won’t comment on specific funds.
Just that 7-8 years may look far for now. However, in a few years, the goal may not be as far.
You need to look at asset allocation (not the break-up between equity funds but between equity and debt).
For 3-4 months, suggest you put in a liquid fund.