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One Time Manadate in Mutual Funds

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OTM or One Time Manadate is the latest way of making investments in Mutual Funds.

In a typical purchase or SIP transaction, investors need to give an ECS an Auto debit mandate to the Bank authorising the Mutual fund company (or its agents such as the Registrar) to honor the transfer of funds.

Because investors wish to make several purchases or SIPs, giving so many mandate became a huge headache.

Added to this, there is paper work and manual process that eats time.

This is why SIPs often take around 21 working days to start.

Life will become smooth with the introduction of One Time Manadate or OTM.

As the name says, OTM is an instruction that you give to the Mutual fund company the permission to debit a specified amount from the bank every time the mutual fund company presents a request for funds.

You have the flexibility to specify how frequently the fund house can ask for funds and for how much maximum amount that can be given per transaction.

It allows the bank to pay the amount when ever the Mutual Fund House asks for money up to a specified limit specified by you.

This allows you to start and stop SIPs as and make easy bank payments without your login to netbanking.

CAMS provides the One Time Manadate in the form of a Common One Time Mandate (COTM) where by you allow CAMS the permission to draw funds from your bank account for any of the schemes that are managed by them.

How to give OTM?

There are two methods by which you can give OTM.

Method 1: Offline Paper Form

OTM authorisation can be given by filling in the specified form available along with the Common Application Form.

Methods 2: Prefilled Paper Form generated online

You can also download a pre-filled in OTM (such as COTM from MyCAMS) from your mutual fund website login interface.

The investor need to take a print of the OTM form, sign it and submit the form to the mutual fund house along with a cancelled cheque leaf.

It will typically take 21 days for the OTM to get activated.

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