Last Updated:
While regular mutual funds are accessible through intermediaries like financial advisors and brokers, direct mutual funds can be purchased directly by visiting the AMC’s website.
With direct mutual funds, investors save on commission fees.(Representative Image)
Mutual funds (MFs) are a stress-free way to grow your wealth in equity markets. Managed by professionals, these are investment schemes created by pooling money from several investors and investing it into various companies, sectors and asset classes. There are mainly two types of MFs in India — direct plan and regular plan.
Direct mutual funds are like going to a shop and buying something directly from the shopkeeper or AMC (asset management company). Regular mutual funds, on the other hand, are when you buy something from a shop through a salesperson.
The best part about direct mutual funds is that investors save on commission fees and earn higher returns, as there are no intermediaries. But the real question is, where to buy direct mutual funds in India?
In this article, we break down the step-by-step process of investing in direct mutual funds.
While regular mutual funds are accessible through intermediaries like financial advisors and brokers, direct mutual funds can be purchased directly by visiting the AMC’s website or through online platforms.
What Are Direct Mutual Funds?
These are mutual fund schemes you buy directly through approved digital platforms or from the fund house. This means there is no middleman, like a broker or distributor, zero commission charges or a lower expense ratio. And you get to keep more of the money invested to grow over time.
What’s even more interesting? Switching from regular to direct plans can boost your returns by 0.5 per cent to 1.5 per cent annually over the long term since the commission cost is eliminated.
Investment through the AMC website
Step 1: Go to the official website of AMC.
Step 2: As a first-time investor, you will first need to complete the Know Your Customer (KYC) formalities using your Personal Identification Number (PAN) and other details.
Step 3: Now, decide on the scheme you want to buy and specify the option under which you want to initiate your purchase.
Step 4: In the next step, opt for investment details, such as a Systematic Investment Plan or a lump sum.
Step 5: After entering your information, confirm the accuracy of the details by authenticating the application form submission using an OTP.
Step 6: Complete the required transaction, and you will receive a confirmation sent to your registered number or email ID.
Investment through Direct Mutual Fund Apps
Another way by which you can buy direct mutual funds is popular apps like Groww, ET Money, Paytm Money, Zerodha Coin, Kuvera, and INDmoney. These platforms allow you to buy funds with zero commission, track your portfolio, and even switch from regular to direct plans. Many apps also offer fund screeners, SIP calculators, and easy-to-use dashboards.
Advantages of investing in direct mutual funds online
Efficiency: The online purchases significantly reduce the time required for investment.
Accessibility: Compared to traditional offline methods, direct investment allows access to a wider range of mutual fund schemes.
Convenience: Registering with an Asset Management Company (AMC) removes the need for repeated KYC verification for future investments from the same provider.
A team of writers and reporters decodes vast terms of personal finance and making money matters simpler for you. From latest initial public offerings (IPOs) in the market to best investment options, we cover al…Read More
A team of writers and reporters decodes vast terms of personal finance and making money matters simpler for you. From latest initial public offerings (IPOs) in the market to best investment options, we cover al… Read More
- First Published: