Kuvera has turned into a shitshow

[karenhampton]

Throwaway account for obvious reasons.

I came to know of Kuvera many years back from this sub itself, so it's only appropriate that I share this here for the benefit of other members.

On 26th February, 2021, I conducted a couple of large (for me the amount is large) lumpsum transactions from both my own account and my managed account at Kuvera, well before cut off time for equity mutual funds. (This was obviously to take advantage of the market correction on Friday. Anyway, that's not relevant)

The transaction somehow failed at Kuvera's end with an error message (screenshot here -

https://imgur.com/a/q3uc3DM

) from their intermediary, BSE Star. Basically, the redirection from BSE Star to Kuvera failed although the transaction was successful. and money was deducted from my account. In instances such as this in the past, I used to always be allocated the day's NAV.

Now, after sending Kuvera relevant details, they have done the reconciliation. However, the allocated NAV shows up as due for processing on March 1, and not February 26th (See Screenshot here -

https://imgur.com/a/wMx11p9

) As you can imagine, this is disappointing for multiple reasons.

1. I'll no longer be confident that a transaction done on a particular day before cut off time will be processed with the day's NAV
2. I'll no longer be confident of taking advantage of corrections in the market even if I manage to invest on that day
3. I no longer have the confidence that Kuvera has got my back in case of issues such as this
4. Simply keeping the money idle in my savings account would've earned me some interest for 3 days. So instances like this leads to potential losses

Obviously as you can imagine, this is related to the SEBI circular which came into effect on February 1, 2021 about NAV being allocated only on realisation at the AMC's end. Since the transaction failed (although it was successful at BSE Star's end, please see the first screenshot), the AMC did not receive funds on that day, and therefore I am not entitled to the NAV of that day. Kuvera's way of handling this is also deeply worrying, since such massive changes and implications should be properly explained to users. I am now actually thinking about using the AMC's websites (no matter how inconvenient it may be) for transactions. At least then I will directly be dealing with the AMC and not the intermediary/broker/advisor.

So, new investors, old investors, please beware of the new rules and its implications. IMO it's time to ditch advisors/intermediaries like Kuvera and switch to investing directly through the AMC's websites. Your profits will thank you for it.

Twitter thread here:

https://twitter.com/i/web/status/1365194050001793025

Follow up post -

https://www.reddit.com/r/IndiaInvestments/comments/lvvb10

 

[ilykmtns]

@karenhampton

I am now actually thinking about using the AMC's websites (no matter how inconvenient it may be)

Contrary to popular belief, the AMC websites are pretty robust (since these are large companies compared to startups like groww, kuvera). I use CAMS directly (it's the registrar ffs) for CAMS serviced funds and few other directly through AMC.

Use excel to track, mate. Just for tracking purpose, you should not be using these sites.

 

[puddy]

@ilykmtns You can use Kuvera for portfolio consolidation, but use AMC site for transaction. Its not very difficult is it

Maintaining an ugly excel sheet on the other hand is a tedious job

 

[karenhampton]

@ilykmtns Thank you. I needed to hear this.

 

[cathy100]

@karenhampton @karenhampton I had posted this as a separate comment, tagging you to make sure that you get the message (yes, I am a noob in reddit ) -

I feel for you as a fellow investor. At the same time, you might just be moving from one type of problem to another. First thing that every investor needs to accept is that this is an industry wide problem not just pertaining to one platform (All hail SEBI..!)

When you transact from an AMC website you have to think of them as a transaction platform rather than the entity that is managing your money. If they don't receive credit details in time through the payment system that they are using, you will again be in the same spot where you are right now.

In case of Kuvera, we don't have to think of Kuvera's transaction capabilities, we have to think of BSE's transaction capabilities as Kuvera is routing everything through BSE. From prior interactions with Kuvera for my queries, I know that BSE uses BillDesk as payment gateway. Now, another important thing to note here is that many AMCs themselves use BillDesk as payment gateway (don't take my word for it, ask your AMC about which payment gateway they use. And yes, they must be using one to complete payments). Now, from the screenshot that you have shared, I interpret this to be a payment gateway issue (notice BillDesk written in the heading of the error). My guess is that BillDesk either failed to receive transaction details from your bank or they failed to send those details to BSE. If Kuvera didn't receive credit details and BSE did, your transaction would have still go through (remember, BSE is the one handling money between bank and AMC, not Kuvera). So, in a nutshell, even if you were using an AMC website, it would have a payment gateway being used for payments, chances of AMCs payment gateway not working as expected are as good as BSE's payment gateway facing issues.

What's worse

BSE has direct bank tie ups with 7 major banks. In other words, you can get NAV of same day while using net banking from one of these 7 banks (at-least when there aren't such failures). On the other hand, most AMCs have direct bank tie-ups with 1-2 banks at most. So, 80-90% investors don't even stand a chance of getting same day NAV while using net banking from their banks, expected NAV itself is of T+1 day for those cases.

Regarding:This means if a transaction fails and your broker isn't on your side fighting with the AMC, you won't get the day's NAV. Period.

Actually, broker or even the AMC standing on your side can't do anything here. If the fund house receives money after cut-off, NAV will be of next day, it's as simple as that (Again, even when transacting on AMC website, money has to flow through a payment system). So, don't assume that if similar issue came up on an AMC website, you would still get same day NAV. You won't. AMCs can't do that while following present regulations.

So, what should investors like you and I do?

I will try out some AMC platforms myself over next few weeks, you can do the same. I am not keeping my hopes high though. There are no 2 ways about the fact that AMC platforms have their own set of troubles, I have experienced them first hand before. With the information that I have at present, I think I will have to stick to Kuvera (emphasis on 'have to' as I think finding better alternative will be super difficult).

IMHO, Kuvera is getting flak right now because we as investors have high expectations from them. The truth is that SEBI implemented this without considering whether system was ready or not and the system was not ready, not even remotely.

Also, if same day NAV is extremely important to you then you should explore ETFs. I am staying away right now as I just don't want to use demat account for investments unless I absolutely do not have any other option.

 

[karenhampton]

@cathy100 Thank you so much for taking the time to explain all this. Really appreciate it.

 

[benjy_lastsonofthewest]

@cathy100

I just don't want to use demat account for investments unless I absolutely do not have any other option.

Is it because of the annual fee associated with them?

 

[ilykmtns]

@cathy100 FYI, while all redditors here were mentioning the delay of their SIPs with MF platforms, I had no delay whatsoever. This is for SIPs in the first week of Feb.

I can understand why these platforms have problems and delay and mark my words: They will continue to do so.

I got nothing against them but the infrastructure is like that. This platforms DO NOT buy from AMCs (which would prevent the delay). They are linked to RTA services like CAMS, Karvy, BSE Star. Fyi, CAMS has ~75% market share. The more layers you add to the system, the more delay and unforeseen circumstances you can expect.

THE only selling point of ALL these different platforms are one or two niche features: like tax loss harvesting, hybrid SIPs, fund analysis/tips and stuff. If you can live without these, then investing directly with the AMC makes a ton of sense.

Edit: corrected

 

[cathy100]

@ilykmtns CAMS, Karvy, BSE are not distributors.

CAMS and Karvy are RTAs. Regardless of what you do, where you transact from or even if you place orders on AMC website. they will be involved in order processing. They are like back-offices for AMCs. Their involvement will have no impact on payment processing. On the other hand, order processing can't be completed without them.

CAMS and Karvy also act like transaction platforms if you want to place orders through them. If you do so then you are essentially using their payment mechanism rather then using AMCs payment mechanism. Regardless, a payment mechanism will have to be used for transferring your funds.

BSEStar can be thought of as another transaction enabler. When you use them, you use their payment mechanism rather then using AMCs payment mechanism. Once again, a payment mechanism involving payment gateways and fund transfer will still be in place even if you use AMC portal.

So, by using CAMS/Karvy/BSE or even Kuvera for that matter, you aren't really adding more layers, you are just deciding which payment mechanism to use. Each mechanism will be prone to errors at the end of the day.

 

[alwaysanxious]

@cathy100 Any update on using AMC?

 

[darrenbraz]

@ilykmtns Actually Kuvera uses BSEStarMF which is BSE's direct API. These failures often happen though and Kuvera support is usually good. Not sure for OPs specific case why it is bad.

 

[resjudicata]

@darrenbraz Can the support change the nav allocation date to T day manually if it's in process?

 

[karenhampton]

@resjudicata Nope. Doubt that can happen. You can raise a complaint at SEBI SCORES (Google it) though if Kuvera doesn't help.

 

[ilykmtns]

@karenhampton That's never going to happen. If the AMC receives the money on Day X, they are bound to give you NAV of Day X irrespective of how long ago you purchased.

 

[resjudicata]

@karenhampton What can SEBI order them to do at the best?

 

[karenhampton]

@resjudicata SEBI has a lot of powers. They can do a lot if they want to. The question is will they.

 

[resjudicata]

@karenhampton When we open their website that complaints at the start/end of the month etc. Are those filed at scores website only?

Tag Gaurav Rastogi. I really want to know what they have to say here.

 

[karenhampton]

@resjudicata

When we open their website that complaints at the start/end of the month etc. Are those filed at scores website only?

Yes.

When we open their website that complaints at the start/end of the month etc. Are those filed at scores website only?

Tagged on Twitter. They know.

 

[darrenbraz]

@resjudicata I don't think so. Frankly the SEBI rules are very confusing for me. So I don't bother timing the market and the NAV value. I just place the order and make sure it is a success.

 

[resjudicata]

@darrenbraz

So I don't bother timing the market and the NAV value. I just place the order and make sure it is a success.

No one is timing the market here. Just investing the extra savings in case of a downfall. And even then if one doesn't get the same day's nav, keeping in mind that every rule was followed it sucks. What really amazes me is that I got same day's nav for the half and like next week for the rest. Out of 2 funds from the same amc, 1 got yesterday's nav and the other next week's. This sucls.