Transferring Mutual Funds to a Direct Plan via the Groww App

Transitioning from a regular mutual fund to a direct mutual fund can be an excellent way to cut down on costs and gain greater control over your investment. The process of switching can be efficiently completed through various methods, including online and offline transfers. In this article, we will guide you through the steps to switch your regular mutual fund to a direct plan specifically using the Groww app.

The Difference Between Direct and Regular Mutual Funds

Firstly, it's important to understand the difference between direct mutual funds and regular mutual funds. Direct mutual funds are managed by the fund house itself, whereas regular mutual funds are handled by agents or dealers who may add their own commission fees. This can significantly impact the total expense ratio (TER) of your investments.

Two key entities involved in the mutual fund landscape are HDFCmf and HDFC Securities. HDFCmf is the fund house that offers direct schemes, while HDFC Securities deals with regular schemes of all funds, including those from HDFCmf. Through the Groww app, you can efficiently manage your direct mutual fund investments.

Why Use the Groww App?

The Groww app provides an easy, efficient, and more profitable platform for managing your mutual fund investments. It allows you to buy, switch, or redeem your fund units directly, without the added hidden costs that can arise through agents. The reliability and security of using fund house mobile apps ensure that your investment is handled professionally and with minimal hassle.

However, beware of agencies that claim to sell direct schemes but are actually selling regular schemes, as this can lead to higher commissions and unexpected costs during redemptions. Always opt for direct investments through the fund house's mobile app to safeguard your interests.

How to Switch from Regular Mutual Fund to Direct Plan via Groww App

The transfer from a regular mutual fund to a direct plan involves both an online and an offline method. For the online process, you will need to:

Log in to your mutual fund account using the AMC (Asset Management Company) credentials or through authorized agencies like CAMS or KARVY. Navigate to the transaction page where you can buy, change, or redeem your fund units. Select the lsquo;switchrsquo; option and then click on the respective fund name. Select the lsquo;Direct Planrsquo; option and follow the steps displayed.

It takes around 3 working days for the change to reflect. The offline process involves visiting the nearest branch of the fund house and filling out a switch form as per your preference.

Important Considerations

It's crucial to note that switching mutual funds means selling your current units and purchasing under a new scheme. Exiting loads, if applicable, will be imposed, and there may be tax implications to consider.

Always take these costs and considerations into account before switching. By using the Groww app, you can efficiently manage your investments and avoid the risks associated with third-party agents.

Conclusion

Switching from a regular mutual fund to a direct plan through the Groww app offers a streamlined, cost-effective, and hassle-free solution. Opting for direct mutual funds by using the fund house's mobile app ensures that you get the best value from your investment without hidden fees.

Stay alert to the potential pitfalls of using non-direct channels and ensure that your investment is handled correctly. The Groww app and similar fund house mobile apps provide a secure platform for managing your investments efficiently.