Let's Diskuss
Asked 8 years ago

How to invest in direct plans of mutual funds?

Finance & Business#Direct plans of mutual funds#Mutual funds Investment#How to invest in direct plans#How to invest
Like
1
1.1K
S
Sumil YadavAuthor

Advertisement

Hey, help the community by sharing your answer.

Earn up to 300 points for helpful answers.

Login to Answer

According to me, direct mutual fund plans are a great option for investors who want to save on commissions and maximize long-term returns. Unlike regular plans, direct plans do not involve distributors or agents, which means the expense ratio is usually lower.

What Is a Direct Mutual Fund Plan?

A direct plan is a mutual fund investment made directly with the fund house (AMC) without any intermediary.

Because there is no commission paid to agents, direct plans generally offer:

  • Lower expense ratios

  • Slightly higher returns over time

  • More control over your investments

Step 1: Complete Your KYC

Before investing, you need to complete the Know Your Customer (KYC) process.

Typically, you'll need:

  • PAN Card

  • Aadhaar Card

  • Mobile Number

  • Email ID

  • Bank Account Details

Most fund houses now allow online KYC verification.

Step 2: Choose the Right Mutual Fund

According to me, selecting the right fund is more important than simply choosing a direct plan.

Common categories include:

  • Equity Funds

  • Debt Funds

  • Hybrid Funds

  • Index Funds

  • ELSS Tax-Saving Funds

Choose a fund based on your:

  • Financial goals

  • Risk tolerance

  • Investment horizon

Step 3: Invest Directly Through the AMC

You can invest directly through the asset management company's website or mobile app.

When investing, make sure you select:
"Direct Plan" and not "Regular Plan."

This ensures you receive the lower-cost version of the fund.

Step 4: Decide Between SIP and Lump Sum

SIP (Systematic Investment Plan)

  • Invest a fixed amount monthly

  • Suitable for salaried individuals

  • Reduces the impact of market volatility

Lump Sum Investment

  • Invest a larger amount at once

  • Suitable when you have surplus funds available

Step 5: Monitor Your Investment

After investing, review your portfolio periodically.

However, according to me, avoid checking returns every day. Mutual funds generally work best when viewed from a long-term perspective.

Benefits of Direct Mutual Funds

  • Lower costs

  • Better long-term returns

  • No distributor commission

  • Greater transparency

  • Easy online management

My Perspective

According to me, direct mutual funds are ideal for investors who are comfortable doing a little research on their own. Even a small difference in expense ratio can significantly increase your wealth over 10–20 years. If you're a beginner, start with a simple SIP in a well-diversified index fund or large-cap fund and focus on consistency rather than trying to time the market. Over the long run, disciplined investing usually matters far more than finding the "perfect" mutual fund.

Must Read: What is different types of mutual funds?

P

Answered By Priya Agrawal

Random Facts Enthusiast
View Profile
Updated on06/05/26
0

Advertisement

  • Direct mutual fund plans can be invested in without involving an agent or distributor.
  • You can invest through AMC (Asset Management Company) websites or trusted investment platforms.
  • First complete KYC verification using PAN, Aadhaar, and bank details.
  • Choose the mutual fund category according to your goals and risk level.
  • Select the “Direct Plan” option instead of the regular plan while investing.
  • Investments can be made through SIPs or lump-sum amounts.
  • Direct plans usually have lower expense ratios because there is no distributor commission involved.

Honestly, direct plans may give slightly better long-term returns than regular plans, but understanding the fund properly before investing is more important than only focusing on lower charges.

V

Answered By Ved Tiwari

Two decades of chartered accountancy — turning complex financial and business realities into writing that professionals and decision-makers can actually use.
View Profile

Ved Tiwari is a Chartered Accountant (CA) and finance writer with over 20 years of professional experience in taxation, auditing, financial planning, and business advisory. He is a Fellow Member of the Institute of Chartered Accountants of India (ICAI) — one of the most rigorous professional qualifications in Indian finance — and holds a Bachelor of Commerce (B.Com Honours) from Shri Ram College of Commerce (SRCC), Delhi University. His content covers personal finance, corporate taxation, GST, investment strategy, business compliance, financial planning, and India's evolving regulatory and economic landscape. His work has appeared on platforms including Moneycontrol, The Economic Times Wealth, and CA Club India, where he writes for finance professionals, business owners, and informed readers who need content built on two decades of real-world financial practice — not surface-level commentary. Over 20 years, Ved has advised hundreds of businesses and individual clients on taxation, audit compliance, and financial restructuring. He has handled complex multi-crore audits, represented clients before tax authorities, and guided startups and established firms through India's regulatory environment. He has published 400+ articles on finance and business, spoken at ICAI seminars and industry finance conferences, and is a practising member of the ICAI Western Region chapter. Across all his writing, every figure is verified, every regulatory reference is current, and every recommendation reflects the same professional standard he applies to his clients — because in finance, accuracy is not optional.

Updated on06/04/26
0

The Mutual fund schemes offer both regular and direct plans. While investing in a mutual fund scheme, an investor gets two options to start out with investment. Mutual fund scheme's direct plans allow the investors to directly invest within the scheme without taking any help of the distributors or intermediaries. Mutual fund scheme's direct plans comes with several other benefits over the regular plan due to which most of the investors subscribe to a direct plan.

If anyone willing to make an investment in the direct plan of a mutual fund scheme. It is important to know how to invest.

Platforms-

Official websites of the Asset Management Companies (AMCs)

Mutual fund utility

Mutual fund registrars like CAMS/Karvy MFS

Online platforms from SEBI-registered investment advisers (RIAs)

Required Documents-

Permanent Account Number (PAN)

Aadhaar Number

A bank account

The KYC documents

S

Answered By stock quantum

Author
View Profile

Stock Quantum is a dedicated group of financial Knowledge and consultants with tremendous industry experience in financial analysis, stock trading education and investments. We aim at providing information-based investment and trading solutions to our follower. Whether you are an individual or a fin

Updated on05/28/26
0

Advertisement

It’s fair and simple. And, in fact, I always recommend people to choose direct plans of mutual funds over the regular plan. Migrating from the regular plan to this one is equally easy. You just have to fill up an application. That’s it!

Coming to your question now, everyone and anyone can invest in the direct plan of mutual funds, which has a much lower expense ratio. Of course, the first thing you need to do is understand the scheme itself. Know about its basics, how it’s better (and bad), what kind of returns you’re going to get and so forth. When making the decision, you must also factor other things, like the track record of the fund, your own distinct goals, and risk profile. Once you have gathered around all the information, make the right decision.
 
Also, you must be careful of the requisites, which isn’t stringent though. You must have PAN card, Aadhaar number, and bank account. As is mandatory by the government, you must fill all your KYC formalities.
 
Next step is to find a good online platform. Today, there exist plenty of online portals that offer direct plans of mutual funds. Look around carefully and pick a nice platform. Once you have found a nice online platform, go ahead and make your investment either by investing a lump sum or set up a SIP. And you’re done! That’s how easy it is! Hope it helped; good luck!
Prreeti Radhika Taneja

Answered By Prreeti Radhika Taneja

Author
View Profile
Updated on05/28/26
0