[Prelude: One of the most frequent customer queries that we get is to enquire about the status of their transfers done through our 'Easy Transfer' feature. One of the most frequent customer complaint we have is about how long it takes. We are writing this short essay to let you all know how the process works, the timelines, and the potential issues.]

One of the most frequently used feature in our platform has been the ‘Easy Transfer’ feature. The ability to transfer your offline holdings to your FundsIndia online account so you can manage your portfolios in one place has proven to be a very attractive proposition for our investors, and we are glad to offer this on our platform.

The process

When an investor puts in a request for a transfer, here is what happens:

1. FundsIndia generates letters requesting the transfers and mails them to the investor

2. Investor signs the letters, and sends them back to us.

3. As soon as we receive them, we send them to the respective AMCs for processing.

4. AMCs process them, and once the transfer is complete, send us the folio data.

5. We verify to see if the address and bank information match between the folio transfered and the investor's account. If it does, we add the folio to the investor's account completing the process. If not, we write to the investor requesting that they send a letter to fix the mismatch. Once the mismatch is fixed, we add the folio to the investor's account as an offline holding.

6. At this time, FundsIndia sends a request to convert the folio to an online folio (so that investors can transact on the folio using the FundsIndia system)

7. AMCs process this request, and once it is converted, they let us know. We move the folio to online mode, completing the process.

As you can see, this is not a trivial process nor is it one over which FundsIndia has total control. We dispatch the requests as soon as they arrive, and we follow up with the AMCs when the expected time has passed. 

Till about six weeks ago, we were doing an extra step in the process above to circumvent the requirement of NOC that some AMCs were insisting on. Now, after the SEBI ruling making that unnecessary, the process has become one step shorter.

The timeline

The transfer process starts after we receive the signed transfer letters from the investors. We dispatch the letters to the AMCs on the same business day in most cases, and the next business day in the rest. After that, the timelines are approximately these:

1. Processing of broker code change by the AMC - 10 days to 2 weeks

2. Verification by FundsIndia: 2-3 days (we need to source the account statement for every transfered folio, and verify the matching of details in a manual process)

3. Dispatch of offline-online conversion request by FundsIndia - 1-2 days

4. Process of online conversion by the AMC - 10 days to 2 weeks

So, for a smooth transfer, the process takes between 25 days to 5 weeks. If there are mismatching details, we would need to add the time needed to get that straightened out - possibly another week to 10 days.

Now, mutual fund schemes being long term investments, this stretched out timeline should not be a bother except to those needing to redeem in the interim. Please note that, at all points of time in this process, the folio is fully under the investor's name, and can be redeemed as an offline holding by visiting the local fund office or CAMS/Karvy outlets.

Issues

Transferring out of online channels: If a mutual fund investment was made through an online channel either affiliated with a bank or not, transferring these investments to FundsIndia would take longer. First, the investor would need to approach the source service provider (the online channel) and request that they convert their investments to offline holdings (direct mode). After that, FundsIndia can process the transfer-in into FundsIndia.

Transferring SIPs: If an on-going SIP is being transferred, it is possible that the SIP investments will get stopped after the transfer is completed. In that case, they will have to be restarted from the FundsIndia account.

Joint holdings: If an investment is being held with another joint holder (even in either-or-survivor mode), both the holders will need to be activated investment account holders in FundsIndia before the transfer can be completed. This is for the simple reason that otherwise, the transfer of holding will mean a change of mode of holding which is not good.

Summary

If an investor is transferring a simple investment made through an offline broker to their FundsIndia account, it has gone on pretty much without issue, even if not as fast as we'd like for it to be. However, in cases enumerated above, special care, and extra patience, will be needed.

All these observations above have been result of things we have learned in the past several months under a swirling wind of changing regulations. Even as we try our best to serve our customers with these transfer requests, we seek your patience and understanding as we go through the process. 

Thanks, and happy investing!