Several investors aiming to invest in mutual fund (MF) schemes amid Tuesday's (election day's) market selloff encountered challenges as leading online MF investment platforms, Groww and Zerodha, struggled to execute transactions on time.
The technical issues resulted in many transactions failing to qualify for the same day's net asset value (NAV) despite being executed before the 2 pm deadline.
Officials from Groww and Zerodha have cited different reasons for these disruptions.
A Groww spokesperson explained to CNBC-TV18 that the delays were due to issues in money movement between banks, exchanges, and Asset Management Companies (AMCs).
The spokesperson highlighted that before SEBI's regulations in July 2022, brokers and mutual fund distributors managed the money movement for MF investment orders to the exchange.
However, with the new regulations, payments now move directly to the exchange and then to AMCs without the intermediary of brokers or distributors.
"We are working closely with ecosystem partners to address these concerns and foster a better customer experience," the spokesperson added.
Zerodha's MF investment platform Coin faced a different issue.
According to Neelesh Verma, Product Head and Assistant Vice-President (AVP) at Coin by Zerodha, the delays were attributed to problems with one of their payment aggregators.
"We work with multiple payment aggregators, and one of them faced issues on Tuesday. Even after pointing out the problem on time, it could not be fixed. As we work with multiple payment aggregators, only a small percentage of the transactions were affected," Verma was quoted as saying in a Business Standard report.
Both platforms are taking steps to prevent such occurrences in the future and ensure a smoother experience for investors.
The technical issues resulted in many transactions failing to qualify for the same day's net asset value (NAV) despite being executed before the 2 pm deadline.
Officials from Groww and Zerodha have cited different reasons for these disruptions.
A Groww spokesperson explained to CNBC-TV18 that the delays were due to issues in money movement between banks, exchanges, and Asset Management Companies (AMCs).
The spokesperson highlighted that before SEBI's regulations in July 2022, brokers and mutual fund distributors managed the money movement for MF investment orders to the exchange.
However, with the new regulations, payments now move directly to the exchange and then to AMCs without the intermediary of brokers or distributors.
"We are working closely with ecosystem partners to address these concerns and foster a better customer experience," the spokesperson added.
Zerodha's MF investment platform Coin faced a different issue.
According to Neelesh Verma, Product Head and Assistant Vice-President (AVP) at Coin by Zerodha, the delays were attributed to problems with one of their payment aggregators.
"We work with multiple payment aggregators, and one of them faced issues on Tuesday. Even after pointing out the problem on time, it could not be fixed. As we work with multiple payment aggregators, only a small percentage of the transactions were affected," Verma was quoted as saying in a Business Standard report.
Both platforms are taking steps to prevent such occurrences in the future and ensure a smoother experience for investors.
First Published: Jun 7, 2024 10:08 AM IST
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