I have been getting many queries about the portals/websites/app investors should use to invest in direct plans of MF schemes. Good to see that the awareness about direct plans is increasing.
And why not?
It is foolish to invest in regular plans if you are a do-it-yourself investor. You are compromising on returns for no hint of advice.
Even for those who need assistance, it may be a good choice to work with a SEBI RIA and subsequently invest in direct plans (especially if you have a big portfolio). Please appreciate the conflict of interest since I am a SEBI RIA.
I have compiled a list of various online direct plan platforms in India. You can try out these portals and choose the one that fits your requirements the best.
List of Online Mutual Fund Direct Plan Platforms in India
Here is the list (in alphabetical order except the first two entries) of direct plan platforms in India.
- Respective AMC websites
- MF Utility ( I use MF Utility)
- Piggy (App only)
- Zerodha Coin
Please understand this is not an endorsement of any of these portals. I have not really used out any of these portals (except MF Utility). For a few others, I have had just a cursory glance.
Moreover, I have no plans to compare these portals any time soon. You need to decide the right portal for you.
Fees/Charges of Direct plan platforms
These direct plan investment portals have different business models. A few charge a flat fee while others charge on a per transaction basis.
You do not have to pay anything for transactions through MF Utility, CAMSOnline or respective AMC websites.
Many of these portals are built upon MF Utility and hence can only allow investments with mutual fund houses that are onboard MFU.
Unlike many regular plan portals, these direct plans platform may not have strong marketing budget. And there is a clear reason for this.
For instance, a regular plan platform will earn ~Rs 50,000-Rs 1 lacs per annum from your investment worth Rs 1 crore (assuming 0.5%-1% commission income). On the other hand, direct plan platform will not earn more than Rs 2,000 per annum for the same or even bigger portfolio.
The earnings may vary based on the business model. Therefore, these platforms need to keep their costs under control.
How should you decide?
You can try out these portals. Almost all the portals offer a free trial period.
I expect all the portals to offer similar features. Don’t think they can do much beyond a point. Many of these portals may choose to display very complex information but I believe much of it won’t be any use for MF investors.
If you were to choose between various pricing models, then you can take call based on your transaction pattern. By the way, investment in direct plan of MF schemes is already saving you a lot of money.
If you do multiple transactions of small values, portals that charge per transaction fee can be very expensive for you. A flat fee model may be a much better choice. For instance, if the portal charges Rs 99 per purchase transaction and you make a purchase of Rs 5,000, you are immediately incurring an upfront cost of 2%.
On other hand, if you do only a few transactions (set up SIP and forget about it), per transaction fee may be cheaper for you (unless there is a minimum annual fee that the portal charges).
Do a bit of simple maths. You will find an answer (if cost is a concern).
These are the direct plan platforms I am aware of. There could be many more. If you are aware of any other such portals, please let me know in the comments section.
Disclosure: I am registered on MF Utility as a SEBI RIA and help clients with online transactions on MF Utility. You can expect me to have a bit of soft corner towards MF Utility.
Book Suggestion: Bogle on Mutual Funds: New perspectives from the Intelligent Investor (John C Bogle)
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