Ah no. When you sell MFs, money hits your bank account directly and not the trading account. So, instead of liquid funds, you can use Liquid ETFs instead. Also, shameless plug for Zerodha AMC’s LIQUIDCASE 
Yeah so instant withdrawals in Kite does not help instant redemption in Coin.
AFAIK LIQUIDCASE does not invest in the same instruments as a liquid mutual fund, since it tracks Nifty 1D rate, which only invests in treps. Despite the similar names, LIQUIDCASE is comparable to overnight mutual funds in terms of holdings. Please feel free to correct me since I could be wrong here.
Nifty 1D Rate index returns are also 0.5% lower than first 2 liquid funds from Coin explore page. So liquid ETF will be even lower due to expense ratios.
On a personal note, I just don’t like the fluctuations in ETFs. Mutual funds having 1 simple NAV is a huge stress relief, nothing to track when selling, iNAV, etc.
With Liquid ETFs too, due to settlement, there is no instant withdrawal, so they are not even addressing that concern to compensate for lower returns.
Since LIQUIDCASE is new, I looked at returns of LIQUIDBEES. 1 year returns were 5.77% according to economic times website. LIQUIDCASE could be higher due to compounding, but not much.
I can get 5% in my small finance bank savings account with deposit insurance and highest liquidity. Liquid mutual funds are a step above with ~7% (in past 1 year) and 30 minute liquidity in non-demat form.
It is a good thing to launch LIQUIDCASE since dividend payments in LIQUIDBEES is terrible, so not saying that’s a bad thing. But I feel it cannot be compared to liquid MFs
Each instrument has its purpose.
The primary need of liquid etf is to get liquidity.
You can sell it and receive 80% instantly in the trading ac as cash. It cuts out all the intermediate dependencies.
1 Like
True. Each serves its own purpose.
That 80% can only be used for trading, not really comparable to Liquid MFs, which redeem to cash into your account.
I am also looking for instant withdrawal for liquid funds. Already shared my feedback with support team but no update from couple of months.
@nithin please enable such feature which make this platform more efficient , effective and flexible. Else customer will wait for some time or will move to AMC directly.
Icici direct does this, even for stocks held in “demat form”
I have been hearing only excuses on tradingqna and Gyan on twitter/youtube from zerodha. No action seems to be evident on the app.
Are you talking about the ability to withdraw funds from stocks sold immediately? ICICI had approval for this before; exchanges are not giving any new approval.
2 Likes
Yes nithin, ICICI has an feature that we can withdraw the funds within 5 mintues from sold stocks and it will be 75% of sold value rest 25% will be released as per transaction timeline.
Yes, they brand it as the e-atm feature and is pretty effective.
If only icici has approval for it, you should be able to question it either in your interactions with SEBI or legally challenge it as this is discriminatory.
NSE regulatory is clear that broker specific approvals will not be given, as was the case in the past.
Weʻve planned to bring this up through the ISF
This isn’t possible with liquid funds. However you can use Liquid ETFs and make use of the instant withdrawal option.
If not possible so how AMC is doing. Should we use direct AMC because liquid fund investment is for emergency need.
Yes, not possible since zerodha holds MFs in demat account.
AMC, Kuvera, etc hold with CAMS/KFintech so they process it instantly.
Disappointing that CDSL, Zerodha don’t support this. SEBI itself had accepted this feature.
2 Likes
Bhuvan - I don’t know which one of us don’t know how instant withdrawals at zerodha work.
If I sell my liquidcase today and then place an instant withdrawal request, it won’t be processed because selling the liquid case would be a trade/executed order for the day. I can withdraw it only the next day.
Am I right? If so, how on earth is it instant withdrawal
1 Like
They consider instant withdrawal as being able to use 80% of the funds for buying some stocks the same day/, very misleading
The way currently the MF industry offers instant withdrawal is up to the limit of 50k, and that is possible only if the investment is in a non-demat mode because the AMC instantly processes the payout because the units in the non-demat mode are in an SOA form with the RTA, unlike Demat mode.
Now, the other mode the units are held up in is a demat mode; this is quite complicated considering the number of parties involved and how the redemption cycle works here. The parties involved are AMC, RTA, CDSL, ICCL and DP.
With Zerodha, the units are in a demat mode; how it works for a purchase order is when you place the order, the units first get delivered to your demat account from the RTA and then remain in your demat account, now in the redemption process, the debit instruction has to be processed.
As @Bhuvan mentioned, you could invest in a liquid ETF and then sell whenever required as of now, you will be able to withdraw the next day, but we are working on the facility to provide the payout on the same day during the market hours.
2 Likes