Home / Economy / Make 10 different Mutual Fund investments with just one number in India

Make 10 different Mutual Fund investments with just one number in India

Mumbai,Khyati Dharamsi: Would you like to fill in 10-different forms for 10 investments in different mutual fund schemes by issuing 10 different cheques, when there is a facility available to just fill in one single form and attach one cheque?


Why then are mutual fund distributors across the country shying away from using the MF Utilities platform, which was launched in January 2015, which facilitates the latter the mode of investing through a common form?

Today, the shared infrastructure service allows you to invest in a mutual fund scheme using a universal folio number termed as common account number (CAN). Hitherto, when you invested in one scheme you were assigned a folio number, next time you invested you were given another folio number, sometimes for investing in the same scheme (if you failed to quote the old folio number). With CAN, you can invest in multiple schemes across fund houses.

When we surveyed distributors we were given a feel that the distributors are already using an online some other platform provided by the likes of iFast Financial, NJ Invest, FundsIndia and the likes and hence don’t feel the need to use another platform.

“I haven’t used the MF Utilities platform and do not intend to use it in the near future. I am very happy with NJ Invest,” said Rajendra Dhulla, who runs advisory Pratham Services.

Another distributor Vivek Damani, who is the founder of Jeevan Prabandhan advisory, says “I am using NSE’s platform as it provides paperless experience. I think under the MF Utilities platform the transaction happens online, but physical forms need to be submitted by the end of the day at designated centres.”

But, there maybe another reason for not using the platform, point out industry experts. The threat of invetsors going direct and leading to a loss of commissions could be one of them, points out an industry insider.

The mutual fund industry is, however, taking definitive steps to bring the advisors on board the MFU bandwagon.

Tata Asset Management has made it mandatory for their employees to transact using the MFU platform alone. R Ganesh, CEO and MD, Tata Asset Management, says, “We have made it mandatory for all our employees to enroll for the ‘CAN’. This does not involve any commitment from our employees other than applying for the CAN.”

The initiative would help the employees to use the MFU platform and hence be more convincing in bringing distributors on board, feels V Ramesh, MD & CEO of MF Utilities.

Other fundhouses such as HDFC Mutual Fund, Birla SunLife Mutual Fund too have held conference calls and meets to increase awareness and the benefits of using the MF Utilities platform.

Why is a common platform in the interest of the industry. “While folio number is fundhouse specific, CAN is industry-wide account number to be used while transacting via MFU. Clearly, it has higher utility and facilitation capability. Not only MFU, but any platform that can provide common transaction facility across houses is a welcome step. There’s no point in entire industry duplicating operating set-ups and related costs,” says Aashish Somaiyaa, MD & CEO of Motilal Oswal AMC.

The industry believes that setting up the same infrastructure would mean a higher cost, which would in turn be passed on to the end user, the investor.

“The best utilisation of an intermediary’s time is for our industry’s growth and that happens when he or she is in front of the client, running around completing transactions and arranging statements is a futile waste of time. An AMC office or website cannot provide common platform across multiple funds,” says Somaiayaa.

A looming problem with using MF Utilities for transaction is that transactions in only 25 of the 44 asset management companies are possible at present. That would be fixed soon, says Ramesh as he is readying engagement from another AMC. “But 94% of the assets are held by these AMCs and one can participate for the time being.”

However, if you want to invest as an individual as well as a joint holder, you would need to apply for separate CANs. This can be done by submitting identity documents and PAN.

Check Also

Rahul Gandhi will lead the party with courage, dedication: Sonia

Congratulating Rahul Gandhi on his elevation, she said personal attacks on her son have made …

Banking sector this week: Debit card payments turn cheaper; insolvency filing for unresolved NPA cases begins

A quick wrap of key developments in the banking sector this week. Related Posts:Asked to …