How to invest in mutual funds using UPI

Fund houses such as Aditya Birla Sun Life Asset Management Co. Ltd, Baroda Pioneer Asset Management Co. Ltd and DFC Asset Management Co. Ltd and distributors such as FundsIndia allow you to invest in mutual funds using unified payments interface (UPI). So, along with payment options such as net banking and national electronic funds transfer (NEFT), you can use UPI as well.

To use UPI, you need to have a bank account with a UPI-enabled member bank and a registered mobile number linked to your bank account. You need to have a virtual ID that looks similar to your email ID—name@bankname.

The process

In case of FundsIndia, download the app on your smartphone. Create the ID on the app itself, choose the fund and make payments. If you already have a UPI and don’t want to create a new ID, after you choose the fund, you can make the payment through your bank app or BHIM app. In case of fund houses, you can pay on their website. Here, the fund house will send you a notification on your mobile phone. In your bank or BHIM app, you will receive the collect request which you will have to approve using your password.

Transaction duration

When you buy mutual funds using net banking or NEFT, the money at times gets processed the next day. As transaction through UPI is instant, there is a possibility that the process will take place faster when you invest. You also don’t need to key in your bank details such as your customer ID, password and one-time-password for your transactions. After enabling UPI, you can use the virtual ID and password. Currently, only select distributors and fund houses provide this facility. You can use this service for lump sum investment. The standing instruction option is currently not available in UPI.