Some of you might find the process of investing in mutual fund schemes very cumbersome as it involves a lot of paperwork. Do you recollect the number of times your mutual fund advisor used jargon such as "FATCA form", "KYC" and "bank mandate" while explaining the formalities to you? And when you invest in Systematic Investment Plans (SIPs) offered by mutual fund houses, paperwork increases even further. Sometimes, investors blindly sign in the slots their mutual fund advisor has ticked, confused and bored by the jargon and bureaucracy. Although, investors themselves are expected to fill in the applications, most often, their advisors/intermediaries do this activity for them. Complicated processes result in loss of time and eventually investors' trust.

History won't repeat itself!

The Bombay Stock Exchange (BSE), recognising the impetus to address these practical difficulties, recently launched iSIP—a feature that allows mutual fund investors to invest in SIPs in a paperless form. invest in SIPs in a paperless form. India's oldest stock exchange will offer this facility on its 'StAR MF' platform—a web-based order routing system for allotment and redemption of mutual fund units. The Mutual Fund Intermediaries (MFIs) and Independent Financial Advisors (IFAs) registered with Association of Mutual Funds in India (AMFI) can access BSE StAR MF platform to buy and redeem mutual fund units for their clients.

What will change for investors?

• Investors save a lot of time, as the new facility involves no paperwork


• Lesser rejections due to errors that otherwise happen while physically filling up hard-copy applications


• iSIP will provide various payment options including net banking and ECS to the investors

Intermediaries should benefit too...

• Reduction in paperwork would lessen the workload on the back office function/department of intermediaries considerably.


• Back office personnel can focus on other value-added services.


• Faster processing of applications would result in greater customer satisfaction.

Investing in mutual funds is a time-tested approach to channelising your savings into equity and debt markets. Investing in equity oriented funds through SIPs offer additional advantages such as rupee-cost averaging; this facilitates reducing the risk associated with timing the market.

If you know which funds to invest in, you may skip the distributors' route and invest directly. Direct plans offered by mutual funds have a lower expense ratio, which helps generate higher returns on investments. If you want to make your mutual fund investments hassle free, consider investing through robo advisory platforms . They allow you to initiate your first transaction within minutes of you logging in to them for the first time. Besides, they offer greater transparency as all records are maintained online, in paperless form.

However, it's noteworthy that, a few of robo advisory platforms work on trial commissions while other follow the 'fee-only' model. You should carefully assess the track record of the robo advisory. If you find it difficult to select mutual fund schemes on your own, you may like to try out the unbiased mutual fund research services offered by PersonalFN.

Key takeaways…   Free your time from paperwork, if it's going to help you secure your financial well-being. Convenience might be one thing, but there is no substitute to investing in a scheme with a proven track record. Invest in direct plans if you believe in the "do-it-yourself" approach. If you want the best of both worlds, invest in direct plans and opt for robo advisory services offered by 'fee-only' advisors. Opt for SIPs to avoid the risks associated with timing the markets.

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