Hi Gourimaya,
From your queries, it is apparent that you are new to MF investments. Hence, I will try and provide an overview of how this industry works and what it means for an end consumer like us. I will answer your specific queries at the end of this post.
First, let take these in one step at a time. As an investor, you decide to invest in one or more MFs through SIP route. For this, you need to apply to the AMC with an application form and a Bank mandate specifying the SIP amount, frequency and dates. You can apply directly to the AMC either online or going to their office. However, if you wish to invest in different AMCs, you need to follow this process with everyone.
An alternative to this is single gateway to invest which is either through a broker or a Investment Services Account with your bank (HDFC Bank, ICICI Direct) or through some non-commission websites like FundsIndia. It is very critical to understand the role of FundsIndia. They are nothing but brokers who will interact with AMCs on your behalf. For you as a consumer, it is simple sequence of mouse-clicks. Every fund has a fund maintainence charge / exit and entry loads attached. Out of these charges, the commission is paid out to the brokers. However, in case of Direct Investment, I am not sure if this is waived off (especially Maintainence charge). The last I checked, it wasn't the case, but would definitely love to hear from knowledgeable souls.
Now, you have applied for investment. However, there needs to be a central registrar of all your investments across different AMCs and provide a framework for transaction processing. This is where CAMS comes into the picture. In short, they are nothing but an IT-services provider and as long as AMCs function, they have business
. Another perspective of looking at this is registrar of companies. There are many companies in India all registered with Registrar. A company can close, but can a registrar close down?
CAMS achieves this cross-linking using the email id specified during registration. Off late, I have seen PAN dependency and I am sure, shortly it will be based on PAN. In general, CAMS is a window to get a snapshot of all your transactions and is very similar to getting a bank statement across different AMCs. I would definitely encourage you to read the link which I had posted earlier.
Coming to your specific queries,
Is it possible to get a single account from CAMS for all my investments ?
Asterix: YES, it is possible to a single statement (not account) from CAMS for all your invesments. Please note that your individual fund investments will have unique folio nos. and you can get a consolidated statement for all your folios from CAMS.
How safe/reliable is CAMS ? What happens to my investments if CAMS closes down after a few years ?
Asterix: I would rate CAMS as safe as a bank. Your investments are with the AMC and not with CAMS. Hence, even in the worst case, if CAMS closes down, nothing happens to your investments. Only effect may be that you may not a single statement of all your folios and may have to depend on your broker/broking window for the same.
Will they charge any fees for investments/maintanance ? Compared to direct investment in AMCs, will I have to pay anything extra ?
Asterix: NO. CAMS is an IT-services provider and will be paid by the AMCs. For an end consumer like you, it's no extra charge.
What is the difference between the services of CAMs & FundsIndia ?
Asterix: I have explained above. CAMS is a window to view your transactions or a book keeper. FundsIndia is a broker through which you invest.
Happy Investing !!