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NISM Certifications · NISM-Series-V-A: Mutual Fund Distributors · Investor Services

An investor holding units in a mutual fund folio wishes to change the registered bank account for receiving redemption proceeds. Which is the most appropriate step under standard operating practice?

The investor should submit a formal change of bank mandate request to the AMC or registrar, with proof of the new account such as a cancelled cheque or bank statement, plus old bank validation where required. A verbal instruction is not enough, and no waiting period or redemption is needed.

  1. ASubmit a change of bank mandate request with proof such as a cancelled cheque leaf or bank statement, along with a copy of the old bank details or proof as requiredCorrect
  2. BSimply inform the distributor verbally, since no documentation is needed
  3. CRedeem the units and reinvest in a new folio, as bank details can never be changed
  4. DWait until the next financial year, when changes are automatically allowed

Explanation

Change of bank mandate requires a formal written request with supporting proof of the new account (e.g., cancelled cheque) and often validation of the old one, to prevent fraud. A verbal request is insufficient. Bank details can be changed in an existing folio, and there is no annual waiting period.

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