Do you want to invest in mutual funds but are intimidated by the thought of opening a Demat account? You are not alone.
Many people are depressed from investing in mutual funds because they believe a Demat account is necessary. The good news is that you don’t need a Demat account to invest in mutual funds online.
This article will guide you through buying mutual funds online without a Demat account and show you how easy it can be to start investing.
Buying Mutual Funds Online Without a Demat Account:
Investing in mutual funds has become easier than ever before with the availability of online platforms. However, many believe a Demat account is required to invest in mutual funds.
A Demat account is only necessary to invest in stocks and bonds. On the other hand, mutual funds are units of professionally managed funds that pool money from several investors to invest in a portfolio of securities.
To invest in mutual funds online without a Demat account, you need to follow these simple steps:
Choose a Mutual Fund:
Research different mutual fund options and select the one that aligns with your investment goals and risk appetite.
Register with a Mutual Fund Company:
Register with a mutual fund company that offers an online platform for investing.
Provide Know Your Customer (KYC) Details:
Submit your KYC details, including your PAN card and Aadhaar card details and your bank account details.
Make a Payment:
Pay through net banking, UPI, or any other available payment method.
Start Investing:
Once the payment is processed, you can invest in your chosen mutual fund.
Following these simple steps, you can start investing in mutual funds online without a Demat account. It is a hassle-free and straightforward process to help you achieve your investment goals.
Option 1: Using the Asset Management Company’s Website or Office:
One way to buy mutual funds online without a Demat account is by using the asset management company’s website or office.
You can visit the website or office of the mutual fund company, register for an account, provide KYC details, and make a payment through various payment methods such as net banking or UPI. Once the payment is processed, you can start investing in the mutual fund of your choice.
Option 2: Independent Investment Portals:
Another way to buy mutual funds online without a Demat account is by using independent investment portals. These portals allow you to invest in various mutual funds from different asset management companies.
You can register for an account, provide KYC details, and pay through various payment methods.
The portal will then facilitate the investment process on your behalf, allowing you to invest in multiple mutual funds through a single platform easily.
Option 3: Registered Mutual Fund Advisers:
Registered mutual fund advisers can also help you buy mutual funds online without a Demat account.
These advisers are authorised by the Securities and Exchange Board of India (SEBI) and can guide you in selecting the right mutual fund based on your investment goals and risk appetite.
They will also help you with the registration process and facilitate the investment process on your behalf.
However, it is important to ensure that the adviser you choose is registered with SEBI to avoid any fraudulent activities.
Option 4: Transfer Agents Such as CAMS and Karvy:
Transfer agents such as CAMS (Computer Age Management Services) and Karvy can also help you buy mutual funds online without a Demat account.
Mutual fund companies authorise these transfer agents to provide various services, including facilitating mutual fund investments.
You can visit their website or office, register for an account, provide KYC details, and pay through various payment methods.
Once the payment is processed, the transfer agent will facilitate the investment process on your behalf, allowing you to invest in multiple mutual funds through a single platform easily.
Option 5: Banks:
Banks also offer to buy mutual funds online without a Demat account. You can either visit the bank’s website or visit the bank’s branch to register for an account and provide KYC details.
Once the account is created, you can pay through various payment methods such as net banking or UPI.
The bank will then facilitate the investment process on your behalf, allowing you to invest in the mutual fund of your choice. It is important to ensure the bank you choose offers the mutual fund you want to invest in.
Steps to Invest in Mutual Funds Online Without a Demat Account:
The following are the steps to invest in mutual funds online without a Demat account:
Choose a Method:
Select one of the options mentioned above, such as using the asset management company’s website, independent investment portals, registered mutual fund advisers, transfer agents such as CAMS and Karvy, or banks.
Register and Complete KYC:
Register for an account and complete the Know Your Customer (KYC) details by providing documents such as an Aadhaar card, PAN card, and address proof.
Select the Mutual Fund:
Once the KYC process is complete, select the mutual fund you want to invest in based on your investment goals and risk appetite.
Make Payment:
Pay for the mutual fund you want to invest in through various payment methods such as net banking, UPI, or debit card.
Confirm the Transaction:
After payment, confirm the transaction to initiate the investment process.
Receive Units:
Once the transaction is completed, you will receive units in the mutual fund scheme based on the amount invested.
Track Investments:
Keep track of your mutual fund investments by checking your account regularly and monitoring the performance of the mutual fund.
Step 1: Register on The Mutual Fund Platform:
The first step to buying mutual funds online without a Demat account is to register on a mutual fund platform of your choice.
This involves providing personal and contact details like your name, address, mobile number, and email ID. You may also need to set up a password to access your account.
By registering, you can access the platform’s features and begin investing in mutual funds.
Step 2: Complete KYC (Know Your Customer) Requirements:
The second step to buying mutual funds online without a Demat account is to complete your KYC (Know Your Customer) requirements. This involves submitting your identity proof, address proof, and other necessary documents.
You may also need to provide biometric details like fingerprints or complete an in-person verification process.
Once your KYC is complete, you will be able to invest in mutual funds up to a certain amount as per SEBI guidelines.
Step 3: Select a Suitable Mutual Fund Scheme:
The third step to buying mutual funds online without a Demat account is to select a suitable mutual fund scheme. You can choose a scheme based on your investment objectives, risk appetite, and financial goals.
Researching the scheme’s historical performance, fund manager’s experience, and expense ratio is important before deciding. The mutual fund platform may also provide tools and resources to help you select a suitable scheme.
Step 4: Make Payment and Invest in The Chosen Scheme:
The fourth and final step to buying mutual funds online without a Demat account is to make payments and invest in the chosen scheme.
You can select the amount you wish to invest and make payment through net banking, debit card or UPI. Once the payment is processed, your investment will be made in the chosen mutual fund scheme.
You will receive an account statement as proof of your investment, and you can monitor your investments through the mutual fund platform.
Conclusion:
Buying mutual funds online without a Demat account is a simple and accessible option for investors who want to start investing in mutual funds.
With the help of various online platforms and mobile applications, you can easily compare and choose the best mutual funds that fit your investment goals and risk tolerance.
So, start investing today and watch your money grow over time. Happy investing!
Frequently Asked Questions (FAQs):
A Demat account is a digital account that holds your securities electronically.
It is required for buying and selling stocks, bonds, and other securities in India. However, you do not need a Demat account to buy mutual funds.
Yes, buying mutual funds online without a Demat account is safe as long as you choose a reliable and trustworthy platform.
These platforms follow strict guidelines set by the Securities and Exchange Board of India (SEBI) to ensure the safety and security of your investments.
You can buy mutual funds online without a Demat account through various platforms such as mutual fund distributors, online investment platforms, and mobile applications.
You can register on these platforms, complete your KYC (Know Your Customer) formalities, choose the mutual funds you want to invest in, and make payments online.