How to Invest in Mutual funds

Invest In Mutual Funds

How to Invest in Mutual funds?

Similar to opening an account or getting a new phone connection there are few formalities that one must complete before investing in a mutual fund.  In this article, we will discuss about these requirements and the process of investing in a mutual fund scheme.

  1. Documents Required:

A. KYC details

B. Account Proof* : Cancelled Cheque or Bank Statement

*The proof must be having Investor’s name, Bank’s IFSC & MICR printed on it.

Since KYC is an important requirement to invest in Mutual funds, let us know more about KYC.

KYC is an abbreviation of Know your customer.  SEBI has issued guidelines under Prevention of Money Laundering act, 2002 which require all Mutual fund companies to follow KYC process for their customers. There are 3 types of KYC namely

  • KYC – Know Your Customer
  • CKYC – Central KYC
  • e-KYC – Electronic KYC


KYC is required by all financial institutions like banks, insurance and mutual funds. For each of these institutions you have to submit separate KYC form. If you are KYC compliant with banks even then you have to get your KYC done again when you invest in mutual funds.

For new mutual fund investors it is mandatory to submit CKYC form. For existing KYC compliant customers till now obtaining CKYC is not mandatory.

CKYC is the new form of KYC. The reason behind CKYC is to have a structure in place which allows investors to complete their KYC only once before interacting with various entities (such as RBI, SEBI, IRDA and PFRDA) across the financial sector. CKYC will be managed by CERSAI (Central Registry of Securitization Asset Reconstruction and Security Interest of India), which is authorized by Government of India to function as the Central KYC Registry (CKYCR).

You have to download and fill the CKYC form and submit it physically as an in-person verification process is part of CKYC. You can download the form from here. You need to submit you photo, Address proof, Identity proof and other related documents as applicable.

If you want to do CKYC online, you can do that by visiting this link.

On submitting the application form with passport size photo/ID/Address proof investors will get a 14 digit KYC Identification Number (KIN) within 4 to 5 days. You can use this number for KYC purposes for all your financial transactions.


eKYC is the easiest way of obtaining KYC. However, this facility is available only for those people who haven’t yet initiated KYC enrolment.  Investor’s Aadhaar number and PAN number are required to complete the eKYC registration. You can login to any AMC’s website, CAMS or KARVY website to complete the formalities.  Please find below 3 step process for eKYC

  1. Fill the online application form which includes you Aadhaar number.
  2. When prompted for OTP, enter the OTP number received on your mobile.
  3. Start investing.

Please note that investors getting eKYC done through Aadhaar may invest only up to Rs.50, 000 per annum, per AMC. After eKYC, you can only invest online and have to pay through electronics payment from your bank account

Requirements in case of Minor Investors

If the investor is a minor, parents/Legal guardian are allowed to invest on behalf of them. However minor will be the first holder and sole holder of the folio and no joint ownership is allowed.

For investments on minor, Parent/guardian need to fill out a third party declaration form, enclose a proof of date of birth (as minor investments are recognized by date of birth) and a proof that shows relationship between the minor and parent/guardian.

Please note that when minor attains age of 18, The AMC will send a letter to registered address to submit a new application form along with additional documents and KYC as prescribed. On failing to furnish the requested details, AMC will suspend all SIP/STP’s. The folio will be frozen for operation by parent/guardian from the date of attaining 18 years of age.

Requirements in case investor is an NRI

For NRI’s the currency of investment should be Indian rupees. Hence they should open an Indian bank account in any of the 3 category and use that cheque leaf to invest in mutual funds.

  • Non-resident external rupee (NRE) account,
  • Non-resident ordinary rupee (NRO) account or
  • Foreign currency non-resident account (FCNR)-with an Indian bank.

The NRI investor should also attach foreign inward remittance certificate (FIRC) or a letter from the bank confirming the source of funds.

Also due to complicated compliance requirement of Foreign Account Tax Compliance

Act (FATCA) many AMCs don’t support NRIs from USA and Canada. The AMCs which support investment from NRIs of USA and Canada are;

  • Birla Sun Life Mutual Fund
  • SBI Mutual Fund
  • UTI Mutual Fund
  • ICICI Prudential Mutual Fund
  • DHFL Pramerica Mutual Fund
  • L&T Mutual Fund
  • PPFAS Mutual Fund
  • Sundaram Mutual Fund

Where to buy mutual funds?

Investors can use WealthTrust app to buy mutual funds. WealthTrust provides access to direct mutual funds which means you pay zero commissions and your investment will fetch an additional 1 to 1.5% returns compared to the regular fund variant.

Investing Process on WealthTrust

WealthTrust app removes the hassles of filling up multiple forms and slips for account opening and transactions. You can invest in schemes of 26 different fund houses (AMCs) through WealthTrust.

Investing through WealthTrust app is as easy as shopping at flipkart or amazon. All you need to do is a 3 step simple process.

  1. Download WealthTrust app from Play store or App store.
  2. Fill the sign up form with basic details
  3. Upload the following: PAN, Bank Account Proof*: Cancelled cheque/Bank Statement, Selfie

*The proof must have your name, IFSC and MICR code printed on it.

Once you complete this process your Investment Account will be opened in 1-2 working days and you can start investing through the app.

You can switch your regular funds to direct funds without even opening an investment account.

To start an SIP there is a onetime mandate required which gets approved by your bank and takes 20-25 days to get approved. Once you place the request for an SIP we send you the mandate which you have to sign and send back to us. Post approval from the bank your SIP starts. This is only one time mandate, and any more SIPs that you want to start do not need any mandate approval. 

There are other methods of investing too which include AMC Websites, other online portals or offline investments through agents, however at WealthTrust we assure you of the best services. Basic plan of WealthTrust is free and we don’t have any hidden charges. WealthTrust provides an excellent research advice to its customers and helps them to manage their portfolio with ease.

New to Mutual Funds? Learn about basics of mutual funds.

Visit our website to know more about WealthTrust. Do read our blogs on Mutual funds.



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