Groww Launches Demat Feature For Mutual Funds: What It Means For Investors? Know From Company’s Founder

Equity investors now have the option to manage their mutual funds just like their stocks and other investments. Online investment platform, Groww, has bought a new feature to let individuals hold mutual funds in demat format leading to simplified mutual fund investment and management.

"In response to growing demand from customers for a more streamlined approach, Groww has been working hard over the past few months to improve this process. Mutual fund investments on Groww will now default to demat mode," wrote company's co-founder and COO, Harsh Jain in a social media post on Friday.

This change aims to enhance user experience by simplifying investment management.
"At Groww, product development is driven by listening closely to customer needs. Over the past year, many users expressed interest in holding mutual funds in demat format. Groww is now excited to announce that this feature is live-bringing investors a unified way to manage all their investments," he added.

Groww's Demat Mode Mode For Mutual Funds: What It Means For Investors?

The move is likely to simplify a range of problems for the investors like mutual funds, bank account updates, etc. It will also provide better freedom to investors for choosing multiple nominees across investments.

With the new feature, mutual funds, stock, ETFs, bonds and other investments will now be consolidated in a single demat account.

Demat mode for mutual funds investment is likely to help in updating bank account details in an easier fashion.

Mutual funds redemption will go straight to the bank account linked to the customers' Groww profile.

Now, multiple nominees can be added in one go and across all investments.

This change aligns with user demand for a more streamlined investment process. Previously, mutual funds were managed using the traditional Statement of Account (SoA) format, while other investments like stocks and bonds already used demat accounts.

What is A Demat Account?

A demat account is an electronic system that holds investments such as stocks, bonds, and now mutual funds. This method simplifies portfolio management by consolidating all investments in one place. Unlike the SoA format, which requires individual updates with each Asset Management Company (AMC), demat accounts offer a unified approach.

Benefits of Demat Account

With the introduction of mutual funds in demat form, Groww aims to enhance convenience for investors. Be it updating bank details once for all folios, multiple nominees at the same time, and redemption proceeds, the new feature will let users manage all their investments from one location.

For those who prefer the traditional approach, Groww still offers the SoA format. In this setup, mutual fund units are held directly with the AMC and transactions are recorded through individual statements. This ensures flexibility for users in managing their investments according to their preferences.

About Groww

Founded in 2016, Groww has rapidly become one of India's largest digital investment platforms. It provides retail investors with a broad range of options including equity, debt, hybrid and exchange-traded mutual funds along with stocks, ETFs and bonds.
The new feature is another attempt of the company to meet its user needs by offering an efficient and comprehensive investment experience.