A little clarity, at every step.

What are mutual funds?

A mutual fund is an investment vehicle where asset management companies (AMCs) gather funds from numerous investors with similar investment objectives. These funds are subsequently invested in a diversified portfolio, including equities, stocks, bonds, securities, and other assets. Investors receive units corresponding to their contribution, representing their share of the fund. Profits generated from the collective investments are distributed to investors based on their individual investment amounts.

Key Terms in Mutual Funds

Net Asset Value (NAV): The price of a single unit of a mutual fund on a given day. It is calculated by dividing the total net assets of the fund by the total number of units outstanding. The NAV is typically published once a day after the market closes.

Expense Ratio: The annual fee charged by a mutual fund to cover its operating expenses, such as management fees, administrative costs, and marketing expenses. The expense ratio is expressed as a percentage of the fund's assets.

Load: A fee charged to investors when they buy or sell a mutual fund. There are two main types of loads: front-end loads, which are charged when you buy, and back-end loads, which are charged when you sell. Many funds today are no-load funds, which means they do not charge any loads.

Asset Management Company (AMC): The company that manages a mutual fund. The AMC is responsible for selecting the fund's investments and making decisions about how the fund is run.

Return: The profit or loss on an investment over a certain period of time. The return on a mutual fund is typically expressed as a percentage.

Investment Objective: Mutual funds can have a variety of investment objectives, such as growth, income, or capital preservation etc.

Fund Type: There are many different types of mutual funds, each with its own unique characteristics. Some common types of mutual funds include stock funds, bond funds, balanced funds, and target-date funds.

Asset Allocation: This is the strategic distribution of investments among various asset classes based on an investor's risk tolerance, financial goals, and time horizon.

Risk Tolerance: Risk tolerance is an investor's ability and willingness to endure fluctuations in the value of their investments.

Yield: Yield is the income generated by a mutual fund's investments, often expressed as a percentage of the fund's net asset value. It includes dividends, interest, and any other earnings.

Index Fund: An index fund is a type of mutual fund designed to track the performance of a specific market index, like the Nifty 50. It aims to replicate the index's returns.

Liquidity: Liquidity refers to how easily an investor can buy or sell shares in a mutual fund without significantly affecting its price. High liquidity is desirable for quick and efficient transactions.

SIP (Systematic Investment Plan): A popular way to invest in mutual funds. An SIP allows you to invest a fixed amount of money into a mutual fund at regular intervals, such as monthly or quarterly. This is a good way to build your investment over time and average out the cost of your shares.

SWP (Systematic Withdrawal Plan): a way to withdraw money from a mutual fund at regular intervals. This can be a good way to generate income from your investment.

Absolute returns: An absolute return refers to the actual gain or loss on an investment without considering its context within the market. It is the percentage change in an asset's value over a specific period, providing a clear measure of the investment's performance independent of market conditions. A positive absolute return signifies profit, while a negative return indicates a loss.

The compound annual growth rate (CAGR) is the annualised rate at which an investment grows, considering the effect of compounding over a specified period. It provides a smoothed annual rate of return, giving a more accurate picture of the investment's performance. CAGR helps investors gauge the consistency of returns over time, irrespective of market fluctuations.

XIRR (Extended Internal Rate of Return): calculates the annualised return, considering irregular cash flows on various dates. It accommodates investments and redemptions made at different times, offering a more accurate measure of overall performance. A higher XIRR indicates better returns, reflecting the compound annual growth rate of the investment over its entire duration.

What is the difference between a lump and a SIP?

A lump sum refers to a one-time investment of a substantial amount in a mutual fund. In this approach, an investor invests a significant sum of money at once.

Advantages:

• Potential for Higher Returns: A lump-sum investment allows the entire amount to be invested immediately, potentially capturing market opportunities and generating returns over a more extended period.
• Simplicity: It is a straightforward investment method involving a single, substantial transaction.
• No commitment to regular investments: Unlike systematic investment plans (SIPs), lump-sum investments don't require a commitment to periodic contributions, providing flexibility.

SIP is an investment strategy where an individual regularly invests a fixed amount of money in a mutual fund at predetermined intervals, usually monthly.

• Rupee Cost Averaging: SIP allows investors to buy more units when prices are low and fewer units when prices are high. Over time, this averages out the cost of the investment.
• Disciplined Investing: SIP instills financial discipline as investors commit to regular contributions, promoting a systematic and planned approach to wealth creation.
• Mitigation of Market Volatility: By spreading investments over time, SIP reduces the impact of market fluctuations, potentially providing a more stable investment experience.
• Accessibility: SIPs are accessible to investors with varying financial capacities, allowing them to start with smaller amounts and increase investments gradually.

What are the various types of mutual funds?

Mutual funds come in various types, each catering to different investment objectives, risk appetites, and time horizons. Here are some common types of mutual funds:

Equity Funds:

• Primarily invest in stocks or equities.
• Present high potential for returns but come with elevated risk.
• Subcategories include large-cap, mid-cap, and small-cap funds.

Debt Funds:

• Invest in fixed-income securities, such as bonds and government securities.
• Pose lower risk compared to equity funds.
• It is suitable for conservative investors seeking a stable income.

Hybrid or Balanced Funds:

• Combine both equity and debt instruments in their portfolio.
• Aim to strike a balance between capital appreciation and income generation.

Money Market Funds:

• Invest in short-term debt instruments like Treasury bills and commercial paper.
• Generally perceived as low-risk with stable returns.

Index Funds:

• Designed to replicate the performance of a specific market index, like the Nifty 50, S&P 500, etc.
• Passively managed, with the goal of matching the index's returns.

Sectoral or Thematic Funds:

• Concentrate on specific sectors (e.g., technology, healthcare) or themes.
• Entail higher risk and return potential, suitable for those with a strong view of a particular sector.

ELSS (Equity-Linked Savings Scheme):

• Equity-oriented mutual funds with a three-year lock-in period.
• Offer tax benefits under Section 80C of the Income Tax Act in India.

Gilt Funds:

• Invest in government securities.
• Generally regarded as low-risk, with interest rate risk being a key consideration.

Global or International Funds:

• Invest in assets outside the investor's home country.
• Exposure to global markets, currencies, and economies.

Liquid Funds:

• Invest in short-term money market instruments.
• Suitable for short-term parking of funds with low volatility.

Fund of Funds:

• Invest in other mutual funds.
• Offer diversification across different fund managers and strategies.

What are mutual fund ratings, and what do they signify?

Mutual fund ratings are independent assessments of a fund's performance and risk compared to similar funds and benchmarks. They don't guarantee future performance, but they offer insights to help you compare and choose funds.

• Stars (Morningstar, ValueResearch): 1–5 star system, higher meaning better past performance relative to category peers.

What are the growth and dividend options?

Growth Option: In this option, payouts are only made when units are redeemed. These schemes do not provide short-term income, as invested funds remain in the scheme, allowing wealth to accumulate until redemption.

IDCW - Income Distribution cum Capital Withdrawal (Dividend Option): In this option, payouts to investors occur periodically, along with the redemption payout. These periodic payments are referred to as dividends. The scheme's net asset value (NAV) decreases each time a dividend is distributed.

What is KYC?

KYC, or Know Your Customer, is a process used by financial institutions to verify the identity of their customers. It helps prevent fraud and money laundering and ensures the legality of financial transactions.

Why is KYC important?

KYC is crucial for maintaining the integrity and security of financial systems. It helps in building trust, complying with regulatory requirements, and preventing illicit activities.

What documents are required for KYC?

Commonly required documents include proof of identity (a PAN card), proof of address (Aadhar), and a passport-sized photograph.

Is KYC mandatory for all financial transactions?

Yes, KYC is mandatory for various financial transactions such as opening a bank account, obtaining a loan, investing in mutual funds,

Can I complete KYC online?

Yes, you can complete the KYC online through our app within a few minutes.

What if my KYC details change?

You need to update your KYC information with the KRA whenever there is a change in your details, like your address, phone number, or email ID.

My PAN and Aadhar are not linked to each other. What should I do?

Sorry, you will need to link your PAN with Aadhaar to complete the KYC as per regulations. Visit the Income Tax Portal at https://www.incometax.gov.in/iec/foportal/.

My mobile number and Aadhaar are not linked. What should I do?

Sorry, you will need to link your mobile number with Aadhaar to complete the KYC as per regulations. Please contact the UIDAI website at https://resident.uidai.gov.in for a link.

I want to update my personal details; how do I do that?

Please contact contact@finbharat.org, and we will guide you and help you with that.

I want to update my communication details. How do I do that?

Please contact contact@finbharat.org, and we will guide you and help you on that.

I want to open a minor account; how do I do that?

Currently, this feature is not available on Finbharat.

Can I add an additional bank account?

Yes, you can do that. In Finbharat, you can add up to five bank accounts.

I want to change my default or primary bank. How can I do that?

If you don’t have the investment, it is easy to change. But if you have prior investments, then you might need to change at the folio level as well. Please reach out to contact@finbharat.org, and we will assist you with this.

I want to delete my bank. How can I do that?

While deletion of a bank is possible within the Finbharat app, the same functionality isn't available at the exchange level. Additionally, deleting your bank account is generally not recommended as it can disrupt future transactions.

How do I invest?

Post verification of the KYC, choose any fund you want to invest, then click on Invest Now, select Lumpsum/SIP, enter the amount and other details, Add to cart: Place an order, enter the OTP, and make the payment via UPI or Netbanking.

What NAV is applicable?

The NAV applicable to mutual fund transactions are determined by satisfying both conditions: the order placement time and the availability of cleared funds in the scheme account within the cut-off time on a working day.

My investment is done. When will units be allocated?

It depends on how the investment is being made. If you have transferred money via net banking or UPI before the cut off time. on a working day, then the amount will be invested on the same day and units will be allotted to you within 2–3 working days. If you have transferred the money after the cut off time, the same will be invested the next day.

What is the minimum amount I can begin investing with?

You can start your investment with a minimum of Rs. 100 (specific to funds). There is no maximum limit on the amount you can invest. However, certain mutual funds may impose limits based on market conditions.

Is there any lock-in for mutual funds?

Equity and debt funds do not have a mandatory minimum lock-in period, providing you the flexibility to withdraw your funds at any time. However, it's essential to note that ELSS/tax-saving funds and certain solution-oriented funds may have a minimum lock-in period of 3-5 years. Therefore, it is advisable to carefully review the scheme details before making any decisions.

Is a mandate necessary when registering the SIPs?

When setting up an SIP, creating a mandate is essential. This allows the financial institution to automatically deduct your chosen amount, making investing hassle-free.

I'm getting an error while creating the mandate. What should I do now?

We understand that this can be frustrating. Unfortunately, sometimes bank servers may experience technical issues or your credentials might not be entered correctly. Don't worry; please retry after some time. If you are still facing the issue, please share the screenshots or videos with us at contact@finbharat.org

We will assist you with that.

I'm setting up an SIP and want to use eNach. How can I ensure my bank supports it?

You can refer to the following link to check eNach supported banks: https://www.npci.org.in/PDF/nach/live-members-e-mandates/Live-Banks-in-API-E-Mandate.pdf

How long will it take to register my mandate?

Generally, it takes 3-5 days for the mandate to be approved.

My mandate got rejected. What do I do next?

You have the option to add another bank and attempt to create a mandate using that bank. If the issue persists, please contact us at contact@finbharat.org.

How do I cancel my mandate?

We recommend not cancelling the mandate. You can choose to pause or cancel your SIPs at any time directly from the app and restart them when desired.

If, however, you still wish to cancel the mandate, you must first cancel all registered SIPs with us. Afterward, contact your bank branch to cancel the mandate linked to your account. The mandate is under your control, and only your bank can carry out its cancellation.

What is the minimum investment required to start an SIP?

It can be as low as 100 rupees, depending on the funds. Please refer to the scheme details page for more information.

The SIP deduction did not occur on the specified date. What should I do?

There could be various reasons for this:

• If the SIP date falls on a public holiday or weekend, the debit will occur on the next working day.
• If you have already made the first installment and the SIP date is within 30 days of registration, the debit will commence in the following month.
• If there are still any issues, please contact us at contact@finbharat.org.

I have cancelled my SIP, but money got debited. Why?

The process of delinking SIP from your account by BSE typically takes approximately 10–21 days.

If the gap between the SIP cancellation request date and the next SIP payment date is less than 10 days, the auto-debit will occur for that particular month. Nevertheless, it will not continue in the subsequent month.

How do I change my SIP dates?

At present, it is not possible to modify the date for ongoing SIPs. To make such changes, you need to cancel the existing active SIP and initiate a new one with the preferred date.

How can I increase or decrease the SIP amount?

Presently, you cannot alter the amount for ongoing SIPs. To make adjustments, it is necessary to cancel the existing active SIPs and create a new SIP with the desired amount.

If you wish to increase the amount, you can create a new SIP with the desired amount within the same scheme.

Is it possible to withdraw funds from the currently active SIPs?

Certainly, you have the flexibility to withdraw at any time; however, please note that there may be an applicable exit load.

I've initiated a withdrawal for my SIP amount, but the money is still being debited.

Withdrawing funds and closing the SIP are distinct processes. To halt automatic debits, you must either pause or cancel the SIP.

My money got debited. Payments are successful, but investments are not reflecting in the portfolio. Why?

We update your portfolio upon receiving unit allotment confirmation from the AMC(s). The duration of this process may take up to 2–5 working days from the date of your successful payment, depending on the type of mutual fund scheme you have invested in.

Why are some funds not appearing in my holdings?

This is because of various reasons:

A. Investments in a minor account may not be reflected in the holdings.

B. If you recently invested, it may take 2–5 working days for it to appear in your holdings.

If you have any other queries, please write to us at contact@finbharat.org with your PAN and fund details.

Not showing correct returns; what should I do?

Please write to us at contact@finbharat.org with relevant screenshots; we will surely assist with the same.

How can I withdraw my funds?

Go to Mutual Funds -> Holdings -> Withdraw -> Select the withdrawal type and enter the OTP to verify, and you are done!

I have placed the withdrawal request but haven’t received any confirmation. What should I do now?

The withdrawal request is initiated right after OTP verification, but it will require 4-5 working days to be credited to your account. Kindly wait until then. If it exceeds 5 days, please contact us at contact@finbharat.org with your PAN and fund details.

Why was my withdrawal request declined?

Most rejections may occur due to KYC being on hold or not verified, mismatched bank details, or attempting to redeem a fund with a lock-in period. Please verify this information. If the issue persists, reach out to us at contact@finbharat.org with your PAN, fund details, and a screen shot of the error.

What NAV will be applicable?

If the withdrawal is initiated before the cutoff time (3 PM), you will receive the same-day NAV; otherwise, you will be allocated the NAV of the next working day.

I want the money in my different bank accounts. Is this possible?

No, this is not possible. The withdrawal amount will be credited to your primary or default account within 4-5 working days.

What is the minimum amount to place the withdrawal?

It is specific to AMC and funds, so please check the fund details for more information.

What is the exit load?

Exit load in mutual funds is a fee charged when investors redeem units within a specified period. It's designed to discourage premature withdrawals and varies based on the fund and holding duration.

Is the exit load uniform across all funds?

No, it depends on the funds. Please refer to the fund details for more information.

Can I redeem outside of the Finbharat app?

Indeed, you have the option to invest or withdraw directly. However, these transactions won't be visible on the app, and it may result in errors due to incomplete folio information. Therefore, this is not recommended.

I’m unable to find some of the funds; what should I do now?

Kindly provide the details to us at contact@finbharat.org, with the fund name, and we will assist you further.

I'm not getting the OTP when trying to buy or redeem funds.

There could be various reasons for this issue.

1. Your registered mobile number with Finbharat may differ from the one you are checking.

2. Network problems with the provider could cause this. To avoid such issues, we also send the OTP to your registered email. Kindly check your email for the same.

I have feedback for Finbharat; where should I submit it?

Fantastic! We value your input. Kindly share your feedback with us at contact@finbharat.org with a subject line like “Feedback”

What is a fixed deposit (FD)?

A fixed deposit is a financial instrument offered by banks and financial institutions where you deposit a lump-sum amount for a predetermined period at a fixed interest rate.

Why invest in a fixed deposit?

FDs offer guaranteed returns, are low-risk compared to other investments, and provide a steady income stream through interest payments. They are ideal for short-term and medium-term financial goals.

Can I open an FD online?

Yes, you can invest in an FD through Finbharat within a few minutes.

Is KYC necessary for investing in an FD?

Yes, KYC is mandatory for investing in FDs.

What documents are required to open an FD?

Basic KYC documents, like ID proof, address proof, and a PAN card, are typically required.

What happens after an FD matures?

You can withdraw the principal and accumulated interest or reinvest the amount for another term.

What are the tax implications of FDs?

Under the Indian Income Tax Act, 1961, interest earned on fixed deposits are taxable in the hands of the investor.

What is the minimum amount that is required to invest?

You can start an investment as low as 5000 rupees.

What documents are required to invest in Shriram FD?

A basic document like a PAN number and address proof like an Aadhar/voter ID, driving licence, or passport

What is the minimum and maximum investment tenure in Shriram FD?

The minimum tenure of a fixed deposit is 12 months, and the maximum tenure is up to 60 months.

Can I add or top-up funds to my fixed deposit?

No, funds cannot be added at any time during the tenure once your FD is booked.

How will I receive the interest amount?

The interest on the FD will be credited to your registered bank account.

I want to renew after maturity; how do I do that?

For this, please share the details, like the FD reference number and PAN details, via email at contact@finbharat.org. We will assist on the same.

Are there any special rates for senior citizens?

Yes, Shriram offers special interest rates for senior citizens at an additional 0.50%* p.a. on fixed deposits.

Are there any special rates for women?

Yes, Shriram offers special interest rates for women at an additional 0.10%* p.a. on fixed deposits.

I’ve invested, but it is not reflecting on the app. What do I do now?

Do not worry, this is because Shriram will verify the KYC and send a certificate within 3–4 working days; after that, I will reflect on the app as well.

I’ve done the investment, but the certificate is not generated. What do I do now?

Shriram will take 3–4 working days to verify the KYC, and after that, you will receive a certificate on your registered email.

I’ve made the payment. From when will interest be calculated?

Your interest will be calculated from the date of your realized investment.

My KYC got rejected; what should I do now?

Share with us your Aadhar front and back copy at contact@finbharat.org, and we will assist on that.

My KYC got rejected; when will I receive the interest?

Interest will be calculated from the date of payment, so sit back and relax.

Can I withdraw money from an FD before maturity?

Premature withdrawals are possible, but they incur penalties and lower interest rates. Shriram won’t allow withdrawals within 3 months. After that, you can withdraw with some penalties.

Can I get the maturity amount from a different bank account?

No, the maturity amount will be credited to your registered bank account, which you can refer to from the certificate.