The Hindu Business Line : Funds tightening norms for PINs

Personal Identification Numbers (PINs) assigned by mutual funds, which clients may use to track their portfolios, are increasingly being couched in stiff terms and conditions, the list of which is growing in the backdrop of changing investment habits.

The reason for such proliferation is a marked increase in the misuse of the tool that is obviously supplied to assist investors. PIN providers are therefore attaching a number of do's and don't's - all of which are aimed at indemnifying the MFs concerned from potential trouble.

A PIN, mostly created and issued against a specific folio number, allows a user to do several things. In many cases, it may be used to purchase fresh units, switch between schemes and even redeem units through systematic withdrawal programmes. A quick look at one's account to ascertain the latest position is also possible.

Sources familiar with the working of PINs indicate that a certain level of exploitation has been noticed among users; there have been instances when quick steps have become necessary to prevent damage. PIN users, it is pointed out in this context, are usually required to follow a set of rules, framed to protect their own interests.

One of the basic rules pertains to keeping in safe custody login names and passwords. A few supplementary requirements - such as an AMC's right to ask for a fax confirmation - are often critical as well.

The situation is prompting fund houses to press for compliance even more. Investors are being asked to meet all requirements, after acknowledging that a particular service may well be terminated or withdrawn through prior notice, MF circles point out.

A PIN user has to agree that any transaction, performed by the use of the right password, will be deemed to be that of the user himself. Improper access to the service by any third party needs to be eliminated altogether, it is felt.

Pru ICICI pushes tracking device

PRUDENTIAL ICICI MF is leading investors towards an online service that enables them to be in constant touch with their holdings.

Branded `Pru Tracker', the service creates access to various kinds of information, including data related to current investments. It also allows investors to see transaction history and ascertain a scheme's performance against benchmarks.

A note from Mr Sumit Sirsikar, head of marketing & customer service at Pru ICICI, mentions that the tracker will further enable clients to purchase and sell in an online environment. An investor can use it to create more folios, alter key personal details and send questions regarding his or her accounts held in the MF. The latter has started sending application forms that will allow investors to register.

The MF has proposed to send PINs by emails. A client will receive a separate mail confirming the activation of the PIN assigned to him or her. More than one folio can be charted through the tracker.