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How do I de-materialize my mutual fund investments?

De-materialization is the process of converting shares and mutual funds that are in physical form into a de-materialized form (digital form) that can be held in your Demat account.

Having mutual funds in DEMAT form has its own set of advantages as explained here .

The procedure to de-materialize is as below -

  1. Download the De-materialization Form (DRF), print out 2 copies, fill it and sign it. Refer to this article to know how to fill up the De-materialization form. For every scheme (same or different AMC), you will need to submit 2 copies of DRF.
  2. Along with 2 Copies of the duly filled De-materialization Form, submit 1 self-attested PAN card copy and self-attested mutual fund statement (if you want to dematerialize 2 schemes, then you will have to submit 4 de-materialization forms with your signature, 2 self-attested PAN card copies, 2 self-attested mutual fund statements, and so on).
  3. You will have to submit the documents to our head office in Bangalore.
  4. Once you submit these documents, we register these details on the CDSL system after which a Demat request number (DRN) is generated. These documents are then stamped by the Depository Participant and then forwarded to the respective Registrar and Transfer Agent (RTA) to complete the process of de-materialization.
  5. The RTA takes between 20-25 days to carry out the de-materialization and credit the units to your Demat account. Once the units have been dematerialized, they show up on Console - our back office platform.
  6. As soon as the units are credited to the DEMAT account (you will receive a notification via SMS/Email from CDSL), please raise a ticket and enter the details in the format mentioned below:

Name of scheme:

Units:

Folio number:

Average Purchase NAV:

Total Investment Amount:

After you have given the details, the units will then reflect in your portfolio on Coin. You can make additional investments, or redeem them.

At Zerodha, the charges for de-materializing are:

  1. Rs 150 per mutual fund scheme.
  2. For mutual funds schemes that are in a lock-in period (ELSS, solutions-oriented schemes, etc), Rs.150 per unique investment (or per installment), be it an SIP or a lump sum investment.
  3. Courier charges are Rs.100 per scheme/fund.
  4. 18% GST will be charged on the total dematerialization charges.

Note:

  1. Close-ended mutual funds which have been de-materialized will not be shown on your portfolio in Coin or Kite. However, they will be present in your Demat account and you can view them on your holding statement . If you want to redeem close-ended mutual funds, you can do so by raising a ticket below.
  2. For ELSS schemes, you will need to submit 2 filled De-materialization forms with one annexure for each mutual fund scheme/ISIN/folio. We will generate a de-materialization request number for each purchase date. Also, the transfer of such a scheme from one Demat account to another will not be possible due to a lock-in period. Before you de-materialize your ELSS schemes, you will have to stop/pause your SIPs in them. If you don't, further allotments will continue to happen in physical (non-Demat) form and you will have to track that investment with the RTA/AMC.
  3. You have to stop any ongoing SIP/STP before sending us the dematerialization request.