NACH not compulsory
Investors who faced difficulties with their SIP investments post May 2016, when the National Automated Clearing House (NACH), a new system of clearing was introduced instead of ECS, will be able to invest without any hindrance. The BSE StAR MF platform has introduced a service through which financial advisors can start SIPs for their clients without any paperwork. So, IFAs can now initiate SIPs on behalf of their clients without submitting any form and NACH mandate.
This new facility can be activated through a net banking platform or mobile application. IFAs will need to generate Unique Registration Number (URN) from the platform for their investors. Investors will then be required to key in this number in the add biller option on their net banking or mobile application. This facility is available in most of the large banks, which take about three days to activate this facility, unlike the 10 days that an SIP mandate through NACH took.
At the moment, BSE has enabled this facility for AMCs like Mirae, ICICI Prudential, Tata and Quantum, with other AMCs to join later. BSE has also put in place the necessary infrastructure to accept payments through e-wallets like Paytm, FreeCharge and Mobikwik, which will kick-in once it gets the necessary approval from the market regulator SEBI.