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Registrar and Share Transfer Agent - A Service To Mutual Funds & Investors

Author: Bhaskar Goyal
by Bhaskar Goyal
Posted: Nov 05, 2019
mutual fund

An array of paperwork is involved in the transactions related to mutual funds. These documents act as shreds of evidence & references at a point of time in the future. Such documents along with the transactions carried out by the investors such as exchanging, selling, switching & buying shares, need to be preserved and recorded.

Who is

responsible for the upkeep of such records of Mutual Fund Companies?

Intermediaries orRegistrar and Share Transfer Agent takes on itself the responsibility to maintain such records of Mutual Fund Companies. Like SAG RTA whichis a Jaipur based RTA Agent.

Let us read about registrar and transfer agents, who they are, what do they do and how they are helping investors?

Who are Registrar & Share Transfer Agent?

Shares are offered to the investors by Mutual Funds, publicly-listed companies, and other financial entities. The registrar and transfer agents are organizations which are formed to keep the records of transactions carried out by the investors in order to facilitate the mutual fund houses.

Some companies have their own RTAs while most of them prefer to appoint an intermediary like a bank to perform this job. The company's transfer agent can be found out through the investor relations segment present on the website of the company.

A brief report on Registrar & Transfer Agent for Mutual Funds

Investors execute many transactions that are related to Mutual Funds including the sale, purchase, and switch of shares or units regularly. Such transactions need to duly & accurately maintained & recorded by the mutual fund houses.

Since the job consumes times and demands expertise, a mutual fund company seeks an expert who can professionally handle & upkeep a massive database of the transactions and to whom the job can be outsourced. These experts who are given the responsibility to manage the records of the investors on behalf of the mutual fund companies are referred to as Registrar & Share Transfer Agent.

R&T agents are experts in serving distributors, investors, and Asset Management Companies (AMC). With its roots expanded all over the nation, R&T agents duly meet multiple requirements of the mutual fund houses located in different states of the nation.

R&T agents cater to investors with accurate account statements of the mutual fund companies discovered by SAG RTA Registrar and Transfer Agent websites. Besides, an investor can contact R&T agents for any queries or assistance.

RTA is a mediator between the investor and the mutual fund company. At an extreme, it facilitates mutual fund houses by recording the transactions carried out by the investor and at another extreme, it acts like utility for investors who require any transaction or investment-related guidance or help.

Registrar and Transfer Agent Services to Investors

Registrar & Share Transfer Agents serve Investors in the following ways:

  • By informing them about the Coming-up or existing offers related to mutual funds
  • By notifying them about the profits and maturity dates of Fixed Maturity Plans
  • By facilitating them with Forms of Mutual Fund Houses
  • By enabling them to accomplish their transactions. This is as a direct investment with the mutual fund.
  • By providing them with the account statements of the mutual fund houses.
  • How an R&T agent serves a single-window solution to the investors?

    Registrar & Transfer Agent provides investors with all-inclusive information related to different offers and schemes of multiple mutual fund companies and thus it serves a single-window solution to the investors.

    Who pays R&T Agents?

    Investors are not directly charged by the R&T agents. The mutual fund companies who restore the charges from the investors pay the R&T agents for their services.

    Distributor of Mutual Funds and Advisor

    Distributor of Mutual Funds is an individual who leads and oversees the processing of the transactions under Mutual Funds. He caters his services to the applicant as well as to the shareholders. However, we can not call a distributor as an advisor because the role of both individuals is entirely different.

    A few years ago, independent distributors looked over potential investors with the intent to gain a commission by selling the funds. The commission is taken out from the entry fee charged by fresh applicants. In 2009, these kinds of practices were discontinued by SEBI.

    Distributors, Insurance Agents, and brokers can not be called as advisors. They are simply the product exhibitors with motives of earning commissions from the mutual fund companies.

    An advisor refers to an individual who provides advice on investments. They are being appointed by the investors to make wise investment decisions such as when to buy, sell and switch the shares and so they are being paid by the investors. Advisors never get a commission from the mutual fund companies, neither do they represent any of the mutual fund products.

    SEBI’s booster plans for investments in mutual funds

    The Securities and Exchange Board of India has plans for encouraging investments in mutual funds.

    Direct Plan - The net asset value will be above the distributor plan.

    Distributor Plan- The net asset value will be below the distributor plan i.e. approx 0.5%.

    Eligibility to become a Qualified Distributor

    Any group of individuals, societies, companies, co-operatives, trusts, sole proprietorships and partnership firms is eligible to become a Qualified Distributor.

    To become a Qualified Distributor, one must have the following:

  • Reference No. or ARN code from the Association of Mutual Funds in India (AMFI).
  • Enrollment as a distributor with the concerned mutual fund company.
  • A valid certificate from the Association of Mutual Funds in India (AMFI) acquired on qualifying the AMFI Mutual Fund module. Valid before June 01, 2010.
  • A valid certificate from the National Institute of Securities Markets (NISM) acquired on qualifying the NISM certification exam on or post-June 01, 2010.
  • Note: Essentials for becoming a Mutual Fund Distributor is prescribed by HDFC Mutual Fund Distributor.

    Registrar & Transfer Agent and Mutual Fund Distributors

    R&T agents help the distributors in selling or buying funds on behalf of their customers i.e. the investors. The distributor can easily contact an R&T via its website and submit an application form there. A distributor does not need to visit the office of R&T agent to apply by 3 pm which is a cut off time for application submission.

    The agent can also get the account of sales accomplished by him in between two separate dates on a monthly or quarterly basis.

    Now the distributor can simply register his requirements on R&T?s website and receive the reports within hours. To serve more, R&T has launched to know your customer forms for investors and know your distributor forms for distributors. R&Ts like have reached out to serve insurance companies as well.

    Registrar & Transfer Agent and Mutual Funds Companies

    Registrar Transfer Agent has been proved to be a time-saving and cost-effective solution for the mutual fund companies. R&T agents have expanded branches all over the country and this knocks off the need for the mutual fund companies to establish their branches at a different location to serve its clients.

    R&Ts digitally communicate the newsletters, account statements, and other crucial from AMC on account of investors as well as distributors. This enables mutual fund houses to directly and quickly send your

    account statements on your email id.

    Charges for the Registrar & Transfer Agent Services like SAG RTA are paid by the mutual fund companies which are reclaimed by the customers of mutual funds in the form of an annual cost charged by Mutual Funds.

    About the Author

    I advise to all the companies client & professional in related to finance, accounting, mutual funds and stocks & shares.

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    Author: Bhaskar Goyal

    Bhaskar Goyal

    Member since: Jun 11, 2019
    Published articles: 7

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