IDFC repeats the saga of HDFC fund house

I shared in my previous post how fund house or CAMS delayed sending ECS mandate form to my bank and I had hard time understanding the reasons.

IDFC fund house repeated this saga for me. On 15th when my HDFC ECS bounced, I was worried for IDFC ECS, which was due on 18th and mandate form was still not available with my bank. I called IDFC fund house almost 5 times in two days politely requesting them to tell me the status of ECS mandate form. They kept on telling me that they will get back to me in 1-2 hours but never called back. Hence, I had to make 5 calls for same. Then on 17th evening, I requested them to please stop the ECS for tomorrow. Guy told me he will call me back in 2 hours but I never got a call back.

Result of ridiculous customer service of IDFC fund house, I paid service charges for my bounced ECS. I can only wish that there are more entities like ABN Amro Bank.

How to buy Mutual Funds directly through Fund Houses

I bought first Mutual Fund through a Fund House directly in Feburary 2008 and have never looked back. Personally, I find it convenient and very personal way of buying Mutual Funds. If you want to buy a mutual fund or open a SIP directly through fund house, please take care of following things:

If this is the first time you are buying Mutual Fund of this Company, carry a Xeroxed copy of your PAN Card.

If buying for the first time, and investing more then Rs 50000, please take one photograph of yours and proof of permanent residential address. It’s required to fill KYC (Know Your Customer) form.

Also, for the first time buyers, it is necessary to carry original PAN Card because it will be verified while submitting the form.

If you already have some mutual fund from this company, carry your folio number. New units can be bought against same folio number.

Different Mutual Funds of same company can be bought under same folio number. For example, if you currently have Reliance Equity Mutual Fund and planning to but Reliance Regular Savings Fund, same folio number can be used.

In the form, "Agent that you are buying from" field should be marked as Direct.

Carry at least one cheque.

Carry post dated cheques if you don't want to allow ECS through your bank account and want to open a SIP.

Know the MICR code of your bank. It’s the nine digit code in the cheque just after cheque number.

If your MICR code is starting with 00, it is incorrect due to some reason, most probably because your cheque is "At Par". Please get the correct MICR code, as otherwise ECS will not be possible.

Keep all these points in mind and you can buy a Mutual Fund in 10 minutes.

ECS mandate form costed me heavily

Personal finance always has something new to teach me.

I am using ECS for like ages now; I mean for last 4 years, I never felt I can go wrong with them. And yet, today I saw one of my newly opened ECS bouncing and heavy service charges being levied. Do I need to say it's lose-lose situation for me? My planned investment is not happening and I am charged for same.

I immediately called my bank, ABN AMRO and the customer representative, Abhishek, there was more then a helping person.

He explained me in detail that why it got bounced, because debiting party, i.e. the HDFC Fund House, was supposed to send an ECS mandate form to my bank. They delayed it on their part. In fact my bank received it later in the day.

Then he also checked for me if other two fund houses, whose SIPs are also supposed to be debited from my account through ECS, has submitted ECS mandate form or not. Well, just for fact Reliance has done this favor to me but not IDFC.

Next he explained that what are the possibility, pros and cons of doing it on my own in case IDFC also delays it. In case IDFC's mandate form reaches late, I have to pay one more penalty. :(

And, without me even asking, he raised a complaint to re-consider the charges levied to me. WOW!

That's called customer care that is very rare.

But now to ECS, please bear in mind that ECS mandate is important in case of ECS-Debit transactions and make sure that beneficiary or you submit the same well in time.

I'll keep you all updated about what happens next. In the mean time, my fingers are crossed. I just hope that IDFC send ECS mandate on time, for my sake please. :(

Update: The money that was taken from my account as service charge for bounced ECS is refunded back to my account.