How to move your mutual fund units from one demat to another or gift them
Subscribe to enjoy similar stories. MUMBAI : You can transfer your mutual fund (MF) units from one demat account to another, either to your own or to those belonging to your family members and friends. However, this is an extremely cumbersome and paper-driven (offline) process with no online alternative.
This makes holding MF units in demat form extremely disadvantageous. That said, the only way to gift MF units to someone is through the demat mode. First, open demat accounts for the transferor and the transferee.
"We get two demat accounts—one for the transferor and one for the transferee. If units are in physical form, they must first be dematerialized," explains Amit Sahita, director of Fincode Advisory Services Pvt. Ltd.
If the MF units are currently held as a statement of account (SoA), they must be converted to demat form. This requires filling out a ‘mutual fund dematerialization form’, available from the depository participantor broker. The form asks for important details such as the MF name, folio number, and the number of units to be materialized.
The dematerialization process typically takes three to four business days. Once the MF units have been dematerialized, the transferor must fill out a delivery instruction slip (DIS) to initiate the transfer. It can be obtained from your broker.
The DIS requires important information, including: ISIN number: The International Securities Identification Number (ISIN) of the MF units mentioned in the account statement. Transferor's details: The depository participant's ID and Beneficial Owner Identification (BOID), a 16-digit alphanumeric code that identifies the beneficial owner of securities in a demat account. Transferee's details: The depository participant's ID and
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