You can also invest in Mutual Funds with cash, what are the rules regarding this?

News Topical, Digital Desk : Mutual funds have become quite popular among investors today. Under mutual funds, you can invest in different securities or even the same security within a single fund. You can invest in mutual funds using any brokerage app. But can these brokerage firms also use you to invest in cash?

Can I invest with cash?

According to the rules, certain individuals are exempt from investing in mutual funds. This means that investments in mutual funds can also be made using cash.

These people can invest

Although cash is not allowed in mutual funds, certain individuals are exempt from this policy.

Those who are not taxpayers and do not have PAN/bank accounts can also invest in mutual funds through cash.

For example, farmers, small traders, businessmen, laborers etc. are included in this.

The only condition is that up to Rs 50,000 can be invested in mutual funds through cash per financial year.

Under which rule is permission granted?

This is mentioned in the Prevention of Money Laundering Act, 2002. Furthermore, SEBI has stated this in its AML (Anti Money Laundering) circular. Furthermore, this rule is also mentioned in AML regulations and guidelines. However, it is important to note that only small businesses and Indian residents can benefit from this. This facility is also available to minors investing through their guardians.

What is a mutual fund

Mutual funds offer indirect investment in the stock market. You don't need a lump sum of money. Systematic Investment Plans (SIPs) allow you to invest in mutual funds in installments. The key is that you can choose the investment amount and the investment period.

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