OTM full form in mutual fund is ‘One Time Mandate’. It is a one-time registration process wherein you authorize your bank to deduct a certain amount from your savings account towards the purchase of units in a particular scheme of a mutual fund. The debits are made by the bank based on requests received from the asset management company which receives transaction requests from investors. You can provide this mandate for a set period (for example, five years), or it can remain active until you cancel it.

OTM facility helps you invest in mutual funds smoothly by automating regular investments. It is a paperless, electronic mode of operation. It eliminates the trouble of attaching a cheque or routing the payment through a payment gateway, as well as remembering your debit card or net banking information. It is a convenient way to invest in mutual funds and build your wealth over time.

How Can an Investor Register for OTM?

The registration process for a one-time mandate is simple. All you have to do is fill out the OTM form and provide your personal and financial details. Here’s how you can register for OTM:

1. Bank Account Details

Provide your bank account details like your bank name and branch, bank account number, bank account type, IFSC code, etc. The OTM must be registered using a single bank account.

2. Personal Details

Provide your personal details like name, date of birth, PAN number, address, phone number, e-mail ID, etc. In case you have a joint bank account, you need to provide the details of other account holders as well.

3. Mandate Limit

Specify the maximum amount that can be debited through this platform. If any transaction exceeds the mandated limit, it will be rejected.

4. Investment Details

Share your folio number and choose between two debit options: fixed amount, which is perfect for regular investments like SIP, or maximum amount for one-time lumpsum payments. You can also set the frequency of the debits for your funds, i.e. monthly, quarterly, half-yearly, or as needed.

5. Signature

All bank account holders need to sign the OTM form. The signatures in the OTM form must match with the signatures available in the bank records.

Once you submit the form, the bank will process your request. Once that is done, you will be able to use the OTM facility to make investments in mutual funds.

Benefits of OTM in Mutual Funds

OTM in mutual funds offers the following benefits:

• It is a simple registration process, which can be done in a few easy steps
• It is a one-time process with no follow-up procedures. Once you give your consent, the money transfers are done automatically and regularly for the given time frame.
• OTM works for both lumpsum and SIP transactions.
• You can enjoy an easy setup of investment within a few days of OTM.
• Since transactions are processed on a real-time basis, your funds are realised on the day of the transaction which means you have a high chance of getting the units allotted on the same day.
• There is no limit to the number of SIPs you can register under a single OTM. Just make sure, that the total value of all SIPs should not exceed the specified mandate limit.
• OTM automates money transfer thus instilling discipline in your investments.
• OTM facility ensures increased safety in transactions.
• It ensures lesser chances of transaction failure.

Transactions Covered under One Time Mandate OTM in Mutual Funds

• Fresh Lump-Sum Investments

  You can easily pay for your lump-sum investments using your bank account. The payment will be processed according to the fixed limit mentioned in the OTM form.

• New SIPs

  You can start investing in new SIPs with the OTM service. It is a smooth and convenient process as you need not resubmit your bank details or cancelled cheque.

Conclusion:

One Time Registration (OTM) registration in a mutual fund is a safe process involving your bank and mutual fund. Experience the ease of investing in a mutual fund of your choice without having to go through the same formalities over and over. Register for your online OTM at the earliest.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.