What is Folio Number? Meaning & Benefits

Mutual funds are one of the most popular investment options in India. They are easy to invest in and provide investors with a diversified portfolio of securities. In India, mutual funds are regulated by the Securities and Exchange Board of India (SEBI). As per SEBI guidelines, all mutual fund investors must have a unique identification number, also known as a Folio Number. In this article, we will discuss what is Folio Number in detail, its importance, and how to obtain one.

What is a Folio Number?

A Folio Number is a unique identification number assigned to each mutual fund investor by the Asset Management Company (AMC) when they invest in a mutual fund scheme. The Folio Number helps the mutual fund house to keep track of the investments made by an investor. The number is unique for each investor, and it remains the same for all the investments made by the investor in the same mutual fund scheme.

Why is Folio Number important?

The Folio Number is crucial for mutual fund investors as it acts as a reference number for all their investments in a particular mutual fund scheme. It helps investors keep track of their investments and monitor their performance. Additionally, the Folio Number is also required for making any transactions related to the mutual fund investment, such as redemption, switch, or additional investments.

How to get a Folio Number?

A Folio Number is assigned to the investor by the Asset Management Company (AMC) when they make their first investment in a mutual fund scheme. The investor needs to fill up the application form provided by the AMC, which contains the investor’s personal details, bank account details, and other relevant information.

The application form also contains a section for the Folio Number, where the investor needs to enter their preferred Folio Number. However, in case the investor does not provide any Folio Number, the AMC will assign a unique Folio Number to the investor.

If an investor wants to invest in a different mutual fund scheme of the same AMC, they do not need to get a new Folio Number. The same Folio Number can be used for all the investments made by the investor in the same mutual fund house.

Here’s a table summarizing the ways of obtaining a Folio Number in India for mutual fund investments:

Ways of Obtaining Folio NumberDescription
Fill up the application formInvestors can obtain a Folio Number by filling up the application form provided by the Asset Management Company (AMC) when making their first investment in a mutual fund scheme. The form contains a section for the Folio Number, and investors can either enter their preferred Folio Number or let the AMC assign one.
Register onlineInvestors can also register on the AMC’s website and create a login ID and password to access their electronic Folio Number. They need to provide their personal details and mutual fund investment details to complete the registration process.
Contact the AMCInvestors can also contact the AMC’s customer service to request their Folio Number. They need to provide their personal details and mutual fund investment details to authenticate their account.
Check physical documentsInvestors can also check their physical documents, such as account statements or redemption cheques, to find their Folio Number. The number is usually printed on these documents.

These are the most common ways of obtaining a Folio Number for mutual fund investments in India.

Use case of Folio Number

The Folio Number is a critical aspect of mutual fund investment in India, and it has several use cases. Here are some of the most common use cases of Folio Number:

  1. Tracking Investment: The Folio Number helps investors track their investments in a particular mutual fund scheme. By providing their Folio Number, investors can easily access their transaction history, view the current value of their investments, and keep track of any changes made to their investment.
  2. Taxation: The Folio Number is also crucial for tax-related purposes. For example, if an investor sells their mutual fund units, they will need to report the sale in their income tax return. The Folio Number is required to report the sale of mutual fund units and calculate the capital gains tax liability.
  3. Consolidating Investments: Investors who have multiple investments in different mutual fund schemes may find it challenging to track all their investments. The Folio Number can help investors consolidate their investments by providing a unique identification number for each investment in a mutual fund scheme.
  4. Ease of Communication: The Folio Number facilitates communication between investors and the mutual fund house. Investors can use their Folio Number to communicate with the mutual fund house and make any necessary changes to their investment.
  5. Redemption of Units: The Folio Number is also required for the redemption of mutual fund units. When an investor wants to redeem their units, they need to provide their Folio Number to the mutual fund house.

Overall, the Folio Number plays a critical role in mutual fund investment in India. It provides a unique identification number for each investment and helps investors track their investments, facilitate communication with the mutual fund house, and comply with tax-related requirements.

What are the types of Folio Numbers?

There are two types of Folio Numbers – physical Folio Number and electronic Folio Number.

Physical Folio Number

A physical Folio Number is a printed document that contains the investor’s personal details, mutual fund investments, and transaction history. The physical Folio Number is usually sent to the investor by post within a few weeks of their first investment. The investor needs to keep this document safe as it serves as proof of their investment in the mutual fund scheme.

Electronic Folio Number

An electronic Folio Number is a digital version of the physical Folio Number. It can be accessed online through the AMC’s website. The investor needs to register on the AMC’s website and create a login ID and password. Once the registration is complete, the investor can view their Folio Number, mutual fund investments, and transaction history online.

Advantages of Electronic Folio Number

The electronic Folio Number has several advantages over the physical Folio Number. They are:

  1. Instant access: The investor can access their Folio Number, mutual fund investments, and transaction history instantly through the AMC’s website.
  2. Convenience: The investor does not need to maintain physical records of their investments. They can access all the information online from anywhere, anytime.
  3. Paperless: The electronic Folio Number is eco-friendly as it eliminates the need for paper records.
  4. Secure: The electronic Folio Number is password-protected, ensuring the security of the investor’s information.

In India, there are two types of Folio Numbers used by mutual fund houses:

  1. Regular Folio Number: This type of Folio Number is assigned to individual investors who invest in mutual fund schemes directly through the mutual fund house. The regular Folio Number is a unique identification number that is assigned by the mutual fund house to each investor for their investment in a particular scheme. The regular Folio Number remains the same as long as the investor remains invested in the scheme.
  2. Common Account Number (CAN): A Common Account Number is a unique identification number assigned by the mutual fund industry to investors who invest in multiple schemes across multiple mutual fund houses. The CAN acts as a common identification number for all the mutual fund investments made by an investor, regardless of the mutual fund house or scheme. The CAN helps investors consolidate their mutual fund investments and track their portfolio’s performance more efficiently.

The CAN is assigned by the mutual fund industry’s Computer Age Management Services (CAMS), which is a mutual fund transfer agency that provides services to multiple mutual fund houses. Investors can create a CAN by registering with CAMS through their website or by visiting a CAMS service center.

Once an investor has a CAN, they can invest in multiple mutual fund schemes across multiple mutual fund houses without the need for separate Folio Numbers for each scheme. The investor’s investments in each scheme are linked to their CAN, which serves as a common identification number.

In summary, there are two types of Folio Numbers used by mutual fund houses in India: Regular Folio Number and Common Account Number (CAN). Regular Folio Numbers are assigned to investors who invest directly in mutual fund schemes through the mutual fund house, while the CAN is assigned to investors who invest in multiple schemes across multiple mutual fund houses. The CAN helps investors consolidate their mutual fund investments and track their portfolio’s performance more efficiently.

Decode Folio Number

A Folio Number is a unique identification number assigned by the Asset Management Company (AMC) to a mutual fund investor when they invest in a mutual fund scheme. The Folio Number serves as a reference number for all the investments made by the investor in the same mutual fund scheme.

The structure of the Folio Number varies depending on the mutual fund house. However, it typically contains a combination of letters and numbers. The first few characters of the Folio Number usually represent the mutual fund house’s name or code.

For example, let’s consider a hypothetical Folio Number – ABC123DEF456. Here, “ABC” could be the code for the mutual fund house, “123” could represent the investor’s unique identification number within the mutual fund house’s database, and “DEF456” could be a random combination of characters to make the Folio Number unique.

It is important to note that the Folio Number does not contain any personal or financial information of the investor. It is merely a reference number that helps the mutual fund house keep track of the investor’s investments. Investors should keep their Folio Number safe and confidential as it is required for making any transactions related to their mutual fund investment, such as redemption, switch, or additional investments.

What if I forgot my Folio Number?

Forgetting your Folio Number can be a common occurrence, especially if you have multiple mutual fund investments or haven’t invested in a mutual fund for a long time. However, there are several ways to retrieve your Folio Number:

  1. Check your mutual fund account statement: Your Folio Number is usually mentioned on your mutual fund account statement. You can check your email or physical records to find your latest account statement and retrieve your Folio Number.
  2. Contact the mutual fund house’s customer service: You can contact the customer service of the mutual fund house where you invested to retrieve your Folio Number. You will need to provide personal and investment-related details to authenticate your account.
  3. Check your email or SMS records: If you have registered your email or mobile number with the mutual fund house, you may have received communication related to your investments. Your Folio Number may be mentioned in these communications.
  4. Check your bank account records: If you have invested in a mutual fund through your bank, you can check your bank account records to find your Folio Number. The transaction details of your mutual fund investment will have your Folio Number mentioned.
  5. Use the mutual fund house’s website or mobile app: Many mutual fund houses have an online portal or mobile app that allows investors to access their investment-related information. You can log in to the portal or app using your PAN or registered mobile number to retrieve your Folio Number.

In case you are still unable to retrieve your Folio Number using the above methods, you can approach a mutual fund distributor or financial advisor who can help you retrieve your Folio Number. It is important to keep your Folio Number safe and confidential as it is required for making any transactions related to your mutual fund investment.

Separate Folio Number for each scheme

Each mutual fund scheme that an investor invests in will have a separate Folio Number. This is because the Folio Number is a unique identification number assigned by the Asset Management Company (AMC) to a mutual fund investor for each scheme they invest in.

Investing in multiple mutual fund schemes is a common practice as it helps investors diversify their investment portfolio and manage risk. Each scheme has its own investment objective, asset allocation, and risk profile, and investors can choose schemes based on their investment goals and risk appetite.

When an investor makes an investment in a mutual fund scheme, they are assigned a separate Folio Number for that scheme. This helps the AMC keep track of the investor’s investments in that particular scheme, including the number of units held, the purchase price, and the current value of the investment.

Having separate Folio Numbers for each scheme also allows investors to manage their investments independently. For example, if an investor wants to redeem or switch their investment in a particular scheme, they can do so without affecting their investments in other schemes.

In summary, each mutual fund scheme that an investor invests in will have a separate Folio Number, which serves as a unique identification number for the investor’s investments in that scheme. This helps the investor and the AMC to manage their investments independently and effectively.

Folio Number Statement

A Folio Statement is a document provided by the Asset Management Company (AMC) that contains a summary of an investor’s mutual fund investment in a particular scheme. The statement is typically provided at regular intervals, such as quarterly, half-yearly, or annually, depending on the mutual fund house’s policy.

The Folio Statement provides important information about an investor’s mutual fund investment, including:

  1. Folio Number: The unique identification number assigned by the AMC to the investor’s investment in a particular scheme.
  2. Investor details: Name, address, contact details, and PAN (Permanent Account Number) of the investor.
  3. Transaction details: Details of all the transactions made by the investor in the scheme during the period covered by the statement, including the date of the transaction, the amount invested or redeemed, the number of units purchased or sold, and the NAV (Net Asset Value) at the time of transaction.
  4. Portfolio summary: A summary of the investor’s current holding in the scheme, including the number of units held, the current value of the investment, and the percentage of the total assets under management (AUM) represented by the investor’s investment.
  5. Expense ratio: The expense ratio of the scheme, which is the percentage of the AUM charged by the AMC as management fees for managing the scheme.
  6. Other details: Other details such as dividend distribution, tax deducted at source (TDS), and any other charges deducted from the investment.

The Folio Statement is an important document that helps investors keep track of their mutual fund investment and evaluate their portfolio’s performance. It also serves as a record of all the transactions made by the investor in the scheme, which can be used for tax and other regulatory purposes.

Investors should carefully review the Folio Statement to ensure that all the information is accurate and up-to-date. In case of any discrepancies or errors, investors should immediately contact the mutual fund house’s customer service to get them rectified.

FAQs on Folio Number

What is a Folio Number in mutual funds?

A Folio Number is a unique identification number assigned by a mutual fund house to an investor for their investment in a particular scheme. It helps the mutual fund house to keep track of the investor’s investment in the scheme and facilitates easy communication between the investor and the mutual fund house.

Can I have multiple Folio Numbers for investments in the same scheme?

No, an investor can have only one Folio Number for their investment in a particular scheme. However, if the investor has investments in multiple schemes, they will have separate Folio Numbers for each scheme.

How can I find my Folio Number?

Your Folio Number will be mentioned on the mutual fund account statement provided by the mutual fund house. You can also find your Folio Number by logging in to the mutual fund house’s website or by contacting their customer service.

Can I change my Folio Number?

No, you cannot change your Folio Number. Once assigned, the Folio Number remains the same as long as the investor remains invested in the scheme.

What happens to my Folio Number if I switch to another mutual fund scheme within the same mutual fund house?

Your Folio Number will remain the same if you switch to another mutual fund scheme within the same mutual fund house.

Is a Folio Number required for every mutual fund investment?

Yes, a Folio Number is required for every mutual fund investment, as it serves as a unique identification number for the investor’s investment in the scheme.

What should I do if I forget my Folio Number?

You can find your Folio Number by checking your mutual fund account statement or by contacting the mutual fund house’s customer service. If you are still unable to find your Folio Number, you can provide your PAN number and other details to the mutual fund house, and they will assist you in retrieving your Folio Number.

Can I invest in mutual funds without a Folio Number?

No, a Folio Number is mandatory for investing in mutual funds, as it serves as a unique identification number for the investor’s investment in the scheme.

Conclusion

In conclusion, a Folio Number is a unique identification number assigned by a mutual fund house to an investor for their investment in a particular scheme. It helps the mutual fund house to keep track of the investor’s investment in the scheme and facilitates easy communication between the investor and the mutual fund house.

Investors can obtain their Folio Number from their mutual fund account statement, by logging in to the mutual fund house’s website, or by contacting their customer service. If an investor forgets their Folio Number, they can provide their PAN number and other details to the mutual fund house, and they will assist in retrieving the Folio Number.

There are two types of Folio Numbers used by mutual fund houses in India – regular Folio Number and Common Account Number (CAN). The regular Folio Number is assigned to individual investors who invest directly in mutual fund schemes through the mutual fund house, while the CAN is assigned to investors who invest in multiple schemes across multiple mutual fund houses.

Investors should ensure that they maintain a record of their Folio Number as it is mandatory for investing in mutual funds. With the help of a Folio Number, investors can track their investments, view their transaction history, and access other relevant information related to their mutual fund investments.

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