In order to promote paperless procedures, top stock exchange NSE on Thursday enabled e-mandate facility on its mutual fund platform, a move which will help fund distributors reduce the time taken for registration of SIP (systematic investment plans).
The e-mandate facility would help exchange members and mutual distributors significantly reduce the SIP registration cycle to just two to three days, as compared to two to three weeks earlier, the exchange said in a statement.
Currently, distributors register paper-based mandates for their investors which involves obtaining the signature of an investor on the form and submission of physical form at service centre for processing.
The facility is an Aadhaar based functionality and accordingly requires mandatory registration of mobile number with UIDAI for e-signing of mandate.
"Implementation of e-mandates is a very significant step towards digitisation of transactions in mutual funds," NSE managing director and CEO Vikram Limaye said.
"The objective is to offer simple and hassle-free alternatives to the members and MF distributors in the form of e-mandates wherein they can register mandate of an investor online, which will be digitally signed based on Aadhar based OTP validation," he added.
NSE has implemented e-mandates through HSBC (sponsor bank for the initiative) along with E-Mudhra as an e-sign service provider.
According to NSE, as many as 48 lakh transactions aggregating to Rs 23,345 crore have been processed through its mutual fund platform, in the current financial year till December 15.
"In last two years NSE has registered a growth of more than 600 per cent in number of transactions, routed through its MF platform," the exchange said.
"Further, the number of SIP accounts on the platform has increased from 0.85 lakhs as on March 31, 2015, to 4.45 lakhs as on December 15, 2017," it added.