How to Invest in Mutual Funds without Demat Account

How to Invest in Mutual Funds without Demat Account

In recent years, mutual funds have grown in popularity among investors. This is partly due to the simplicity of the investment and the opportunity for diversification. Furthermore, there is a diverse choice of mutual funds to pick from. After you've narrowed down the funds you want to invest, you may wonder how to proceed. Many people invest in mutual funds using a demat account. However, there are alternative options to explore. If you're wondering how to acquire a mutual fund without a Demat account, you can choose from the following.

Investing in Mutual Funds without a Demat Account

There are alternative ways to enter the world of mutual funds without a Demat account. 

1. Choose the right investment platform

Seek out an investing platform that provides direct mutual fund plans without needing a Demat account. Several internet platforms and mobile applications offer this function, making it simple to do mutual fund investment without Demat account

2. Complete the registration process

Sign up for the preferred investing platform by entering your name, contact information, and email address. Create a safe password for your account next.

3. Provide necessary KYC documents

To comply with regulations, you must complete the Know Your Customer (KYC) process. Submit scanned copies of your PAN card, address proof, and a passport-sized photograph. Some platforms may allow you to complete the KYC process online using Aadhaar-based e-KYC.

4. Select the desired mutual funds

Explore the available mutual fund options on the platform and analyse their performance, risk profile, and investment objectives. Then, select the funds that align with your financial goals and risk appetite.

5. Invest in the platform

Once you have selected your mutual funds, you can invest a lump sum or set up a Systematic Investment Plan (SIP). First, indicate the amount you wish to invest and provide your bank account information for payment. Then, complete the transaction to finalise your investment.

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Table of Content

  1. Investing in Mutual Funds without a Demat Account
  2. Top Reasons to Invest in Mutual Funds
  3. Advantages of Investing in Mutual Fund Without a Demat Account
  4. Tips for Successful Mutual Fund Investment

Top Reasons to Invest in Mutual Funds

Here are some of the primary reasons why investors should consider mutual fund investment.

  1. Professionally Handled Investments

    Experienced professionals manage active mutual funds. They have the requisite knowledge and experience in managing big investment portfolios. These managers pick assets based on the fund's objectives and help investors obtain considerable returns through proper portfolio monitoring.
  2. Low-Cost

    Systematic investment plans (SIPs) enable individuals to start investing in mutual funds with minimal balances. This makes the investment less expensive for investors preferring small-scale and scattered investments.
  3. Goal-Based Investment

    Investors can choose from various mutual funds based on their unique investment objectives. One may also choose mutual funds depending on his investment time horizon and risk profile.
  4. Portfolio Diversification

    Investing in mutual funds helps portfolio diversification since investors may select funds depending on their risk-reward ratio. Investors may combine bank deposits and mutual funds to profit from fixed and market-linked returns.

How to Invest in Mutual Funds without Demat Account


Advantages of Investing in Mutual Fund Without a Demat Account

Mutual fund without a Demat account offers several advantages, making it an attractive option for many investors. Here are three key benefits:

1. Simplified Investment Process

 Investing in mutual funds without a Demat account simplifies investment. Unlike investing in stocks, where a Demat account is typically required, mutual funds can be purchased directly from asset management companies (AMCs) or through mutual fund distributors. This eliminates the need to open and maintain a separate Demat account, streamlining the investment journey.

2. Lower Costs and Fees

Investing in mutual funds without a Demat account often lowers costs and fees. Demat accounts may have associated charges, such as account opening fees, annual maintenance charges, and transaction fees. By bypassing the need for a Demat account, investors can avoid these additional expenses, allowing for a more cost-effective investment experience.

3. Access to a Wider Range of Mutual Funds

Mutual fund without a Demat account gives you access to various mutual funds. Although some mutual funds are only available to Demat account holders, many asset management companies offer direct plans or options for investing without a Demat account. This wider selection allows investors to choose from various funds based on their investment objectives, risk tolerance, and personal preferences.

By investing in mutual fund without a Demat account, investors can enjoy a simplified investment process, save on costs and fees, and access a wider range of mutual funds. In addition, this flexibility empowers investors to tailor their investment strategy to suit their financial objectives and preferences.

Tips for Successful Mutual Fund Investment

Here are some essential tips when investing in mutual funds without a Demat account, ensuring a successful investment journey.

1. Define your investment goals

Before investing in mutual funds, clearly define your investment goals. For example, determine whether you are investing for retirement, education, a down payment on a house, or any other specific financial objective. This clarity will help you choose the right mutual funds that align with your goals.

2. Consider your risk tolerance

Assess your risk tolerance level before investing. Mutual funds come in various categories, such as equity, debt, and hybrid funds, each carrying different levels of risk. Conservative investors may prefer debt funds, while those seeking higher returns may opt for equity funds.

3. Diversify your portfolio

Diversification is key to managing risk in mutual fund investments. Invest in funds across different asset classes and sectors to spread your risk. By diversifying, you minimise the impact of a single investment's performance on your overall portfolio.

4. Regularly review and rebalance your investments

Keep track of your mutual fund investments and review them periodically. Market conditions, economic factors, and fund performance can change over time. Rebalancing your portfolio ensures that your investments align with your desired asset allocation and helps maintain a well-diversified portfolio.


Investing in mutual funds is a great option to enhance your financial situation. But trading without demat account is not possible. With a step-by-step guide and helpful tips, you can confidently invest in mutual funds without a Demat account. To make the process even more convenient, consider utilising the blinkX trading platform. 

With blinkX, you can easily purchase mutual funds without a Demat account and access a wide range of funds. Additionally, their user-friendly interface and advanced features ensure a smooth investment journey. So take control of your financial future and start investing with blinkX today.

FAQs on How to Invest in Mutual Funds without Demat Account

You can invest in mutual funds without a demat account.

You can invest in mutual funds without a demat account by using the services of an online mutual fund platform.

Yes, it is possible to purchase mutual funds without a demat account.

To buy mutual funds online without a demat account, follow these steps: choose a mutual fund platform, complete the registration process, provide necessary KYC documents, select the desired fund scheme, and make the investment.

In addition to the basic steps, you may need to fulfill Know Your Customer (KYC) requirements, such as submitting your identification and address proof.


Yes, you can sell mutual funds without a demat account through the same online mutual fund platform you used to invest in the stock market.

Yes, you can start a Systematic Investment Plan (SIP) without a broker. Many mutual fund companies allow investors to directly invest in their SIPs without the need for an intermediary like a broke

To directly buy mutual funds, select a fund, visit the AMC's official website or app, complete the KYC process, and make your investment online.

No, you cannot invest in mutual funds without a PAN card. In India, it is mandatory to have a PAN card. To start investing in mutual funds, complete the Know Your Customer (KYC) process and provide the PAN details.