Turnaround times for mutual fund transactions and RTA services
Every service an RTA performs runs on a SEBI clock. The full table, and how to count the days.
A turnaround time, or TAT, is the maximum time SEBI allows a mutual fund to complete a service for an investor. Redemption money, IDCW payouts, NFO allotment, account statements and changes to a folio each have their own deadline. The RTA does most of this work for the AMC, so these clocks are the RTA's working calendar.
Series II-B tests TATs as straight recall: which service, how many days, and counted from what. The traps are in the units. Some deadlines run in working days, some in business days, some in calendar days, and some fall on a date of the next month.
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Financial transactions: the TAT table
Table 14.2 of the December 2024 Series II-B workbook.
| Service | Turnaround time |
|---|---|
| NAV calculation and disclosure after the NFO | Daily, on the AMC and AMFI websites |
| NFO open for subscription (schemes other than ELSS) | Maximum 15 days |
| Allot units or refund money after an NFO | Within 5 business days of NFO closure |
| Reopen an open-ended scheme (other than ELSS) for sale and repurchase | Within 5 business days of allotment |
| Dispatch of IDCW (dividend) payments | Within 15 days from the record date |
| Dispatch of redemption proceeds | Within 3 working days from receipt of the request; 5 business days for overseas funds |
| Consolidated Account Statement (CAS) | On or before the 15th of the following month |
| Unit certificate on request | Within 5 working days of the request |
| Demat units for a close-ended scheme on request | Within 2 working days of the request |
| SoA for NFO or ongoing transactions (not systematic) | Within 5 working days from the transaction |
| SoA for the first SIP, STP or SWP instalment | Within 10 working days |
| SoA for later systematic instalments | Part of the CAS |
| SoA on specific request in systematic transactions | Within 5 working days, free of cost |
Non-financial services by the RTA
Table 15.1 of the workbook, from SEBI's November 2021 circular on the RTA investor charter.
| Service by the RTA | Turnaround time |
|---|---|
| Processing a transmission request | 21 days |
| Change or update of name, signature or nomination | 21 days |
| Change or update of contact details (address, e-mail, mobile), bank account details or PAN | 15 days |
| Response to investor inquiries and redressal of grievances | 21 days |
Worked example: one investor, one week
Illustrative dates. Assume Monday 7 December 2026 starts a week with no holidays.
- 1
Monday 7 December: redemption request received
Count 3 working days after the day of receipt: Tuesday, Wednesday, Thursday. Proceeds must be dispatched by Thursday 10 December. If the scheme were an overseas fund, the limit would be 5 business days, so Monday 14 December.
- 2
Monday 7 December: the transaction is processed
The Statement of Account is due within 5 working days of the transaction: Tuesday to Friday is four, the following Monday is the fifth. SoA by Monday 14 December.
- 3
Thursday 10 December: IDCW record date in another scheme
The workbook's table allows 15 days from the record date, so the payout must go by 25 December. Note the footnote below: SEBI's November 2022 circular tightened this.
- 4
End of December: the monthly CAS
There were transactions in December, so the CAS for December must reach the investor by 15 January 2027.
- 5
Same week: a change of address request
This is a non-financial service. The RTA has 15 days to complete it. A nomination change filed the same day would get 21 days.
Free account, this exam preselected.
The workbook carries two IDCW timelines
Table 14.2 says IDCW payments within 15 days of the record date. Footnote 86 of the same December 2024 workbook cites SEBI's circular of November 25, 2022, which cut redemption payment to 3 working days (from 10) and set IDCW payment at seven working days from the record date. The workbook tells candidates to read the latest circular. If an option says seven working days for IDCW, do not dismiss it.
What happens when a deadline is missed
- Late redemption or IDCW
- Delays attract penal interest of 15 percent per annum, paid by the AMC.
- Late NFO refund
- Investors are paid interest at 15 percent per annum for the period of delay. This interest cannot be charged to the scheme.
- ELSS NFO
- Excluded from the 15-day NFO window and the 5-business-day allotment rule. The workbook notes ELSS allotment must be done within 30 days.
- Folio with no transactions for six months
- The CAS goes out at the end of each six-month period (September and March), on or before the 21st of the following month.
How the Series II-B exam tests this
- check_circleRedemption: 3 working days from receipt of the request. The older figure of 10 working days is a classic wrong option.
- check_circleOverseas funds get longer: 5 business days for redemption dispatch.
- check_circleNFO: open for at most 15 days (non-ELSS), allot within 5 business days of closing, reopen within 5 business days of allotment.
- check_circleCAS by the 15th of the next month; the half-yearly CAS for dormant folios by the 21st.
- check_circleRTA services: 21 days for transmission, nomination, name or signature changes and grievances; 15 days for contact, bank and PAN updates.
- check_circleWho bears the 15 percent penal interest: the AMC, never the scheme.
FAQs
What is the turnaround time for mutual fund redemption?expand_more
Redemption proceeds must be dispatched within 3 working days from the date the request is received. For schemes investing overseas, the limit is 5 business days. Earlier the limit was 10 working days.
Within how many days must an RTA process a transmission request?expand_more
21 days, as per the TAT table for RTA services in the Series II-B workbook. The same 21 days applies to changes of name, signature and nomination.
When is the Consolidated Account Statement sent?expand_more
On or before the 15th of the month after a month with a transaction in the folio. If a folio has no transactions for six months, a CAS is sent after September and March, by the 21st of the following month.
What if a mutual fund pays redemption or IDCW late?expand_more
The AMC pays penal interest at 15 percent per annum for the delay. The same rate applies to delayed NFO refunds, and that interest cannot be charged to the scheme.
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