If you are a regular investor in mutual fund (MF) schemes and have investment across fund houses, going to multiple portals to make the purchase or redeem your units is now passé.
You can now do it from the comfort of your home and at the click of the button, without having to shell anything extra for the convenience.
Welcome to MF utilities, a transaction platform facilitated by the mutual fund industry, which helps invest in multiple schemes across fund houses in one shot. The portal is a transaction aggregating system, which consolidates the transaction request from multiple investors / sources and submits it to the registrar and transfer agent, thereby ensuring efficiency of operations. It connects all the partners in the investment process namely Investors, registrar and transfer agent and Asset Management Companies (AMC). The platform is completely free not just for investors but also for distributors and SEBI-registered investment advisers. If you are a MF distributor or an RIA, you can register yourself on the MF utilities portal, upon successful completion of which you will be given a login access to transact online.
How to get started
Irrespective of whether you are an individual or non-individual investor, the first step towards transacting through MF utilities is to complete the CAN (common account number) registration. The CAN application form can be downloaded online, duly filled and submitted, along with requisite documents, to the nearest Mutual Fund Utilities (MFU) point of service (POS) or MFU office. There are about 373 MFU POS centres listed in the website. You can check for the one close to your house. As an individual investor, you can also choose to complete the CAN registration online, by filing an eCAN, wherein all the data required is submitted electronically and the same is instantly created.
However, to avail an eCAN facility, you need to be KYC-compliant and should have invested already in any of the participating asset management companies (AMCs), which are part of the MFU.
Upon successful completion of CAN registration, all your existing MF investment will also be mapped using the CAN credentials and you can access all your MF investments in one place.
Using a common transaction form, you can invest in schemes across MF houses at one go. You can make a single payment for investment across multiple schemes and multiple fund houses. There are multiple modes of payment that you can choose from. Physical modes such as cheques are also accepted.
Besides lumpsum investing, you can also set up Systematic Investment Plans (SIP), Systematic Transfers (STP) and Systematic Withdrawals (SWP) using PayEezz mandate on the MFU portal.
You can now invest in the direct option of multiple schemes across fund houses through the MFU portal at one go and benefit from the higher returns (higher by about a per cent or so).
This saves you the hassle of having to either go to the registrar and transfer agent office or their website or that of the AMC for individual transactions. You can get a consolidated view of all your investments in one place.
What are the cons?
Not all the 44 MF houses are part of the platform currently. There are only 34 participating AMCs currently in the MFU system and you can invest or redeem units of these AMCs only through the platform.
If you are looking to invest in the schemes of the 10 fund houses that are not part of the MFU portal, you will have to go through the respective AMC’s portal, registrar and transfer agent or intermediaries such as robo advisers or independent advisers.
If you are a beginner, looking to invest in equities and need help in selecting the right fund for you, you may be better off going through a robo-advisory firm or an independent adviser.
(The writer is an independent financial consultant)