How to Create an Account in Mutual Funds

Why Should You Invest in Mutual Funds?

Investing in mutual funds has become one of the most popular and effective ways to build wealth over time. Whether you’re saving for retirement, a new home, your child’s education, or just want your money to grow, mutual funds provide an excellent opportunity.

The best part? You don’t need to be a finance expert to get started. All you need is a smartphone or computer, basic KYC documents, and a few minutes of your time.

Let’s explore how you can open a mutual fund account—both online and offline—in just a few easy steps.

Step-by-Step Guide to Create a Mutual Fund Account

Step 1: Complete Your KYC (Know Your Customer)

KYC is a mandatory process regulated by SEBI (Securities and Exchange Board of India) before you can start investing.

Here’s what you’ll need:

• Passport-size Photograph – Recent, clear photo

• Bank Account Details – Account number, IFSC, and a cancelled cheque

You can complete e-KYC (online KYC) through:

• CAMS Online

• Karvy KRA

• Directly via AMC (Mutual Fund Company) websites

• Popular apps like Groww, Zerodha Coin, and Paytm Money

Pro Tip: Go for e-KYC to complete verification without physical paperwork. It’s fast and fully online.

Step 2: Choose Your Investment Platform

You can open a mutual fund account through different platforms:

🔹 Option A: Directly Through AMC Websites

These include well-known names like:

• SBI Mutual Fund

• HDFC Mutual Fund

• ICICI Prudential Mutual Fund

Investing directly usually means zero commission fees (higher returns).

🔹 Option B: Online Investment Platforms (Recommended)

These platforms are user-friendly and support Direct Plans:

• Groww

• Zerodha Coin

• Kuvera

• Paytm Money

🔹 Option C: Through Banks

Many banks offer mutual fund services. However, they may push Regular Plans, which have commission charges.

Tip: Always choose platforms that offer Direct Plans for better long-term returns.

Step 3: Create Your Mutual Fund Account

Once you choose a platform, it’s time to register. Here’s what you’ll generally need:

• Email ID and 📱 Mobile Number

• PAN and Aadhaar Card

• Bank Details (Account Number, IFSC)

• Digital Signature (upload or draw online)

Most apps allow you to complete this in under 10 minutes.

You will be prompted to set up a password and verify your identity via OTP (One-Time Password) on your mobile.

Step 4: Link Your Bank Account

You must link your savings account for:

• Automatic SIP deductions

• Investment redemptions (withdrawals)

• Receiving dividends or interest (if applicable)

The verification process is simple:

• Net banking verification

• Penny drop verification (Re 1 deposit for account verification)

Important: Use a bank account that is in your name and matches your KYC documents.

Step 5: Start Investing in Mutual Funds

After your account is approved and bank linked, you’re ready to invest!

You can choose between:

Systematic Investment Plan (SIP)

• Fixed amount invested every month

• Great for disciplined wealth building

• Start with as little as ₹100/month on many platforms

Lump Sum Investment

• One-time investment

• Suitable if you have a larger sum to invest

You’ll also need to pick:

• Fund Type: Equity, Debt, Hybrid, or Index

• Goal-Based Plans: Retirement, child’s education, travel, etc.

Tip: Always check fund rating, past performance, and expense ratio before investing.