Mumbai: Mutual fund houses have begun facilitating buying and selling of units of their schemes through mobile phone handsets to increase their reach. Reliance Mutual Fund, UTI Mutual Fund, Birla Sun Life Mutual Fund and HDFC Mutual Fund have already made it possible for their customers to invest through mobile phones.
MFs have shown a rising interest in allowing transactions through mobile phone after the Reserve Bank of India (RBI) increased the daily limit of banking transactions via mobile phones to Rs 50,000 per individual.
The potential seen is huge as nearly 600 million people use mobile phones in India. The mutual fund houses expect ease of investing through mobile phones to increase their reach to smaller towns across the country.
Both UTI MF and Birla Sun Life use mobile applications of mChek, a mobile payment solutions firm, while HDFC MF has deployed ngpay solution.
UTI mobile and Reliance MF mobile have only buying option available with them. “We have the technology for redemptions also but because of some risk factors, we are not making it functional at this stage,” said Sanjay Kumar Singh, Head of Product Development at Reliance MF.
The mobile service also enables investors to initiate requests for portfolio information, systematic investments plan registration, switches and redemptions.
Birla Sun Life MF and HDFC MF offer their mobile transaction service to their existing clients, while UTI Mutual Fund extends the service to new customers also.
The advisor will continue to get credit for the investments made through the mobile platform until and unless the investor gives a written instruction to the contrary. The automated process saves the advisor the trouble of delivering client’s application form.
If an investor wants to start transacting through his mobile with Birla Sun Life Mutual Fund, a registration form needs to be filled up and submitted at the nearest branch of the mutual fund or a CAMS Investor Service Centre. Thereafter the registration process and a debit mandate verification is carried out.
The biggest drawback of this offering is that it takes up to 25 days to complete the registration process. After registration, mChek sends a message to the registered mobile number asking the investor to install an application on the phone.
The investor, after installation of the application, selects a 6-digit numeric mChek PIN which is used to authorise payments. The investor then has to accept the terms and conditions and thereafter, the mobile application is ready for transacting with the fund house.
D P Singh, National Head--Sales & Distribution, said SBI Mutual Fund is also planning to launch investment through mobile. The public sector fund house is in talks with applications developers. SBI MF currently allows only non-financial transactions.
