Fund Basics. Link multiple bank accounts to your folio

Mutual funds have given investors the facility to register multiple bank accounts in their folios. We answer investor queries on this facility.

I would like to add an additional bank account to my folio. Can this be done?

Mutual funds now offer a facility to individual investors to register up to five bank accounts in a folio. Investors have to specify one account as the “Default Bank Account” and can register up to four additional bank accounts.

Forms are available at the mutual fund websites/CAMS service centres. They would have to attach a cancelled cheque leaf with their name and account number printed therein or a copy of the bank passbook or a statement of bank account containing the name and address of the account holder and account number. The copy should be certified by the bank manager with his/her full signature, name, employee code, bank seal and contact number.

Why opt for this facility?

Registering for this facility enables you to receive redemption proceeds into any one of the registered bank accounts of your choice without having to provide bank details and the supporting documentation at the time of redemption. Some funds do not process such changes if requested along with redemption, or have a cooling period.

Additionally, registered bank accounts may also be used for verification of pay-ins (that is, receipt of subscription funds) to ensure that payments are not made by anyone other than the account holder.

Please explain what is meant by ‘default bank account’.

At the time of registering multiple bank accounts, investors have to specify any one bank account as a ‘default’ bank account.

This account is used for crediting the redemption proceeds if investors do not specify the bank account in the redemption request. Dividend proceeds, if any, are processed into the ‘default’ bank account only.

Can I delete one or more of my registered bank accounts, or change the default account?

Yes, just fill in the relevant portion of the registration form to do this.

Contributed by the Investor Education Team of CAMS. The views expressed herein are general practices in the mutual fund industry and may vary on a case-to-case basis.

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