Can Partnership firms invest in Mutual Funds?

Can Partnership Invest in Mutual Funds
September 14, 2022

Can Partnership firms invest in Mutual Funds?

What is a Partnership Deed?

When two individuals wish to run a business irrespective of the profits or losses that have been incurred, signing a written legal document with mutual consent is known as a partnership deed.  A partnership deed document makes sure that both parties should not have conflicting or disagreement terms over the partnership norms. It is also known as a partnership agreement, the registration done under the Partnership Act, 1932. The partners also have the right to make changes in terms of the Partnership deed format if they wish to.

Therefore, a partnership comprises three necessary elements.

  • A partnership must be an outcome of an agreement between two or more individuals.
  • The partnership agreement must be built to share the profits acquired from the business.
  • The business must be operative by all or any of them representing the rest.

All these situations must coexist before a partnership comes into force.

In this article, we look at the several aspects of running a partnership firm with respect to mutual funds investment in India in detail.

Mode of partnership firms to invest in Mutual Funds

The partnership firms prefer to invest in debt mutual funds through lump-sum mode. The procedure of investing is online and offline subject to the preference of the company. Elevo offers For investing in a mutual fund, the companies must submit certain documentation requirements.

Board Resolution

A resolution must be passed by the company’s board of directors, permitting the board to invest in mutual fund schemes along with restrictions, if any. The board’s authorized personnel have the power to invest and conduct requisite documentation.

Digital KYC

KYC forms are required to be filled out through digital procedures. The process is very smooth while submitting digital KYC on A joint holding should be there between two persons or a maximum of three account holders. For investing under joint names all joint holders should be KYC Compliant.

The copies of following documents are required:

  • Balance sheets for the previous 2 financial years
  • Address, identification proof(UID Adhaar Card/Driving License/Voter ID),
  • PAN of the Partnership firm
  • PAN & address proof of all the Partners
  • Bank statement of firm along with transactions of last 2 months & address proof
  • Copy of Partnership deed
  • Photos of Partners
  • Memorandum and articles of association
  • Certificate of Registration (for registered partnership firm)
  • Latest shareholding pattern
  • Board Resolution & Authorized signatory list (format attached on page 2)
  • Audited Financial Statements (Last 2 years)

(*All Documents should be signed & stamped)


The KYC process for partnership can be done digitally on The investor has to just send the relevant KYC documents to tarrakki’s customer success team. And tarrakki will get the KYC done for you. Once the KYC is successfully completed, the onboarding process starts. For the onboarding process, these are the following requirements:-

  • Email id
  • mobile number
  • PAN cards copy of the Partnership firm
  • Partnership deed
  • PAN & address proof of all the Partners (For UBO details)
  • Cancelled cheque or latest bank account statement
  • Fatca details

(*All Documents should be signed & stamped)

Mutual Funds Schemes available in Partnership Firms

The firms that have free working capital can invest in debt funds so that they can also have liquidity. While for partnership firms that are family offices can choose to invest in equity funds.

On the other hand, for corporates and partnership firms, keeping their money idle in the current account is not the best option. Instead, they can invest in liquid and overnight funds that come under debt mutual funds along with Equity mutual funds.

Debt mutual funds invest their money in debt instruments such as treasury bills, commercial paper, and corporate bonds of several duration that offer fixed returns. Overnight funds invest in debt papers for the shortest period, followed by Liquid funds. The following debt mutual funds and equity schemes are offered in partnership firms for gaining better liquidity. Let’s take a look:

Debt Mutual Fund Schemes

  • Aditya Birla Sun Life Liquid Plan-Growth
  • HDFC Ultra-Short Term Fund – Plan
  • Nippon India Money Market Fund Growth
  • HDFC Floating Rate Debt – Wholesale plan – Growth

Equity Mutual Funds

  • UTI Nifty 50 Index Fund Growth
  • Parag Parikh Flexi Cap Growth
  • SBI Focused Equity Fund Growth
  • Axis Nifty 100 Index Fund Growth


So far you must have understood the partnership deed, the mode of partnership firms to invest in mutual funds, the types of mutual fund scheme they invest in. Partnership firms can now smoothly invest in mutual funds through

Don’t forget to check: How Can Minors Invest In Mutual Funds?