Here's how you can open a mutual fund account online

Why waste your time queuing at the bank or wasting effort with paperwork when you can now invest in mutual funds online. Apart from facilitating investment, most fund houses provide an online mutual fund platform that enables you to access your portfolio, manage and track your investments, and withdraw them from any location at any time. Invest in mutual funds online and take the first step toward building a nest egg for your future and the future of your family.

“Investors can choose to invest in mutual funds online either directly through asset management companies (AMCs) websites or through one of the various mobile applications run by highly credible wealth-tech brands. Considering the ease of access, availability of options, the convenience of tracking investments in different AMCs at one place, and benefits of certain value-added services make the mobile applications a more popular choice,” said Anand Dalmia, Co-founder, Fisdom.

That said, mutual fund plans are classified into two types: direct plans and regular plans. As an investor you can invest directly in a mutual fund scheme with the fund house, either online or by visiting the AMC’s or Registrar and Transfer Agents’ (e.g. CAMS, Karvy) websites when you are investing in a direct plan.

If you invest in a mutual fund scheme via a mutual fund distributor, you are investing in a traditional plan also known as regular plans. The mutual fund distributor assists you in filling up application forms, submitting them to the AMCs, and providing continuous assistance.

Direct plans, on the other hand, are self-service. As a result, the expense ratio of the direct plan will be on the lower side. This is also one advantage of investing online in a direct plan of mutual funds. Before we explore how to register an online mutual fund account, it’s essential to understand that one of the conditions for investing in a mutual fund is compliance with KYC (Know your customer) regulations.

To invest in a mutual fund, you must first comply with KYC (Know your customer) requirements. After that, mutual funds can be purchased. Investors can now complete their Know Your Customer (KYC) process online or offline. Once you have completed the KYC process, you can begin investing in mutual funds online and offline across all AMCs.

 Let’s take a look at how you can invest in mutual funds online.

-As a first-time investor, you have to identify an appropriate asset management organisation and invest in a mutual fund online on their website.
-Typically, these AMC websites are user-friendly and include step-by-step instructions on how to invest easily.
-Simply complete an application with your personal and investment information, make the payment, complete your KYC with adequate proof of identification and residence, and submit everything.
-Your account will be created within a few hours of submitting this form, depending on the AMC’s processing speed.

“Online investing has brought convenience to investors and intermediaries. Investors will benefit a lot as the cost of the products should come down with increasing online transactions. Also, online investing comes with a lot of information and graphical representations of your investment vis-vis benchmarks. All this can help you make yourself a more informed investor and take better decisions,” commented Sandeep Bhosle- VP- Customer Interaction, Quantum AMC.

Endnote

A word of caution: online investing may not be appropriate for everyone. However, with the development of online investing, we can now invest our entire lives’ savings in a single company with the touch of a button on our smartphones. Simply keep an eye out.

“All the convenience, information available on online investing is meant to make us a thoughtful investor. It should not creep into our portfolios in the form of experiments and impulse investing. Investment is a combination of trust, patience, safety, returns, and also convenience,” said Bhosle.