For years, investors used to track their investments through physical mutual fund statements or unit certificates. Though this strategy was fine in the past, it has pitfalls such as paperwork, delays, and lack of ease in tracking portfolios across several fund houses.
Now, the wiser option is to dematerialise your physical mutual funds - a secure, paperless, and hassle-free mode of owning your investments. Let us see why this transition is important, what advantages it offers, and how to switch your holdings.
Converting your demat-eligible physical mutual fund units into demat form isa sensible decision for increased security, ease, and effective handling. Here's are the benefits of switching:
Click to processSingle Portfolio View: With a demat account, you can see all your investments in one place: mutual funds, stocks, bonds, ETFs, NPS, etc. No need to check multiple fund house statements separately. Just log in to your demat account (via apps like DAYCOINDIA or NSDL) and get the complete picture of your wealth.
Ease of Tracking: In demat, you can track the real-time value of your investments, check performance, and monitor your portfolio growth anytime. This makes decision-making and rebalancing much easier.
Paperless & Hassle-Free Management: You don’t need to store physical papers or certificates anymore. Since everything is electronic, you avoid risks like theft, damage, or losing important documents.
Faster Transactions: Buying, selling, or switching mutual funds becomes quick and seamless in demat form. No paperwork delays, everything is done online.
Better Security: Your holdings are kept safely in electronic form within regulated depositories (NSDL/CDSL). This ensures a much higher level of protection than physical documents
Easy Transfer to Family Members: In physical mode, you cannot transfer mutual funds directly from one person's name to another's. But in demat mode, you can easily transfer units from one demat account to another. This makes gifting or transferring investments within the family much simpler.
Ease During Transmission (Inheritance): If something happens to the investor, mutual funds in demat form can be smoothly transferred to nominees or legal heirs, which is much easier than handling paper-based claims.
Reduced Errors: Since there’s no paperwork, there are fewer chances of mistakes (like errors in forms, wrong signatures, or missing documents). Everything is digital and accurate.
Consolidated Statements: You receive a Consolidated Account Statement (CAS) from the depository, which gives you a single snapshot of all your investments. No need to go through multiple reports from different AMCs.
Integration with Other Investments: Your demat account shows all types of investments together like equity shares, mutual funds, bonds, ETFs, NPS, etc. This helps you plan better and keep track of your entire wealth on one platform through unified portfolio management.
Complete Convenience: Overall, demat gives you convenience, speed, safety, and a clear view of your portfolio. It removes the limitations of physical mutual funds and makes wealth management smooth and stress-free.
The dematerialization process is easy. Do this:
Open a Demat Account: If you don't already have one, open a demat account with a Depository Participant like a bank, broker, or financial advisor.
Request a Dematerialisation Form: Ask your Depository Participant (DP) for a CRF (Conversion Request Form) to convert your existing mutual fund units into dematerialised (Demat) form.
Fill Out and Sign the Form: Make sure your information (name, PAN, bank account, folio numbers) is exactly as in mutual fund records.
Submit Required Documents: Completed CRF (Conversion Request Form), Original physical mutual fund statement (SOA) or unit certificates, Valid KYC documents (ID and address proof if required).
Mark the Certificates: Write “Surrendered for Dematerialisation” on your physical statements before submission.
Get an Acknowledgement: Your DP will issue a receipt confirming your request.
Processing Period: The AMC verifies your documents and, once approved, credits your mutual fund units into your demat account. This usually takes 10-25 days.
Ensure joint holder sequence matches between MF folio and demat account.
Save copies of all documents and statements filed.
After conversion, all subsequent purchases in the same folio will also be credited directly to your demat account.
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In case you didn’t know, you can open your account online within 24 hours. Offline account opening takes up to 4 working days. If you wish to open your account offline, fill and sign the forms using a black/blue ballpoint pen. Please fill in the email and mobile number of the applicant to avoid account opening delays.
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