Online brokerage platform Dhan has introduced demat mode for mutual fund holdings, marking a significant step toward portfolio consolidation for retail investors. The feature allows investors to hold mutual fund investments directly in demat form alongside their equity and ETF holdings under one unified account.

Enhanced Portfolio Management Through Consolidation

The demat mode functionality transforms how investors manage their mutual fund holdings by storing all units in the investor's demat account rather than the traditional Statement of Account (SOA) format with individual Asset Management Companies (AMCs). This consolidation provides investors with a single view of their total investments across asset classes.

Streamlined Activation Process

Dhan has designed a user-friendly activation process for both existing and new investors. Existing mutual fund investors can enable demat mode by navigating to the portfolio section on the platform and accessing the demat option without opening additional accounts or completing elaborate procedures.

New investors must open a demat account with Dhan and invest in their preferred schemes, which will automatically appear in demat mode. The platform also supports conversion of existing mutual fund holdings to demat mode, subject to processes defined by AMCs and depositories.

Comparative Analysis: Demat vs SOA Structure

The shift from traditional SOA to demat mode brings fundamental changes in holding structure and operational processes:

Minimal Documentation Requirements

The platform emphasizes reduced documentation burden for activation. Since investors already maintain demat and trading accounts with Dhan, no additional Know Your Customer (KYC) verification is required. The digital-first activation process eliminates paperwork and manual intervention, aligning with the platform's philosophy of reducing operational friction for retail participants.

Key Considerations for Investors

While demat holding offers convenience, investors should consider several factors before switching modes. Some AMCs maintain specific timelines for SOA to demat conversion, and demat accounts may involve annual maintenance charges. Investors who prefer direct AMC interaction or require flexibility across different platforms should evaluate whether demat mode suits their investment approach.

Market Impact and Future Implications

Dhan's introduction of demat mode for mutual funds represents a broader industry trend toward integrated investment ecosystems. The feature addresses growing demand for portfolio consolidation and enhanced transparency among retail investors. By bringing mutual funds into the same infrastructure as equities and ETFs, the platform creates operational efficiencies that could influence industry standards for investment management platforms.

Dhan , India's fastest-growing online brokerage platform, has upgraded its Margin Trading Facility (MTF) interest rates to 12.49% per annum or 0.0342% per day, targeting reduced leverage costs for retail investors. The upgrade forms part of the platform's strategy to provide advanced trading tools to the Indian retail investment segment.

Understanding MTF and Its Market Impact

Margin Trading Facility allows investors to purchase securities by paying only a fraction of the total purchase value, with the remaining amount funded by the brokerage. Interest charges apply on the funded portion, calculated on a per-day basis on Dhan's platform. This structure enables investors to begin their investment journey with minimal initial capital while reducing total leverage costs and increasing net returns.

Many brokers now calculate MTF interest rates on a per-day basis to minimize costs for investors. Investors can estimate their total MTF expenses in advance using MTF calculators , facilitating more efficient trade planning.

Enhanced Features and Expanded Access

Beyond rate reductions, Dhan has expanded its MTF utility significantly. The platform has increased leverage from 4x to 5x, providing investors with higher purchasing power. The eligible stock universe has grown from 1,500 to over 1,700 stocks, allowing MTF usage across a broader spectrum of securities spanning large-cap, mid-cap, and small-cap categories.

The MTF limit has been raised from ₹50 lakhs to ₹1 crore, accommodating larger investment requirements.

New Rate Structure

Dhan's updated interest rate structure features five distinct slabs based on funded amounts:

Competitive Market Positioning

Dhan's MTF rates position the platform competitively within the brokerage industry. The company focuses on providing higher accessibility to market participants at lower rates rather than concentrating solely on high-value clients.

Risk Management and Regulatory Framework

MTF carries inherent risks alongside its benefits. While it amplifies potential gains, it equally amplifies potential losses during unfavorable market movements. The minimum margin requirement stands at 20% for MTF positions. When margins fall below this threshold, brokers issue margin calls, and failure to add funds results in automatic liquidation of pledged holdings to recover outstanding dues.

Best practices include maintaining cash buffers to absorb sudden volatility and meet margin calls, along with implementing stop-loss strategies to limit downside risk.

Market Accessibility and Strategic Impact

The upgrade in Dhan's MTF interest rates represents a significant step toward democratizing advanced trading tools for retail investors. By reducing overall leverage costs and expanding the stock universe, the platform makes equity markets more accessible, enabling participants to execute high-conviction strategies with enhanced financial flexibility.