There has been some controversy on social media regarding allegations of fraudulent investment practices at one of the most popular investment apps known as “Groww”. A user claimed their investment in Parag Parikh Mutual Fund through Groww was not processed despite money deductions.
What is Groww App?
Groww is one of the fastest-growing popular discount brokers after Zerodha. Not only that, but it also acts as an investment platform. It recently added UPI, an instant loan facility and a bill payment system. It operates on a zero-commission model for mutual fund investments. Some key features of Groww include the lowest brokerage charges, a minimalistic user interface, educational resources like Groww Digest, and a wide range of investment options.
The Groww app is downloaded by over 5 crores of people and rated 4.4 out of 5 stars in the Google Play Store.
Similarly, the app is downloaded by over 2 crores of people and rated 4.2 out of 5 stars in the Apple App Store.
What is Groww App Fraud?
In 2020, a man’s sister started investing in the Parag Parikh Flexi Cap mutual fund through Groww. In 2024, when he tried to withdraw money, Groww showed no record of his investment and no money was taken from the bank account. He posted about it on LinkedIn and it became viral almost immediately. After talking with Groww’s support team several times, they admitted there was a mistake with an incorrect entry and folio. To fix it, Groww agreed to refund the money in question. But, Groww asked him to delete all his social media posts, including the one on LinkedIn, as part of the resolution.
New fear unlocked.
Mutual fund platform took money but investment was never made 😱 pic.twitter.com/caUPBAGGCp
— Finance Memes (@Qid_Memez) June 23, 2024
Groww App: Recent Viral Controversies
These are some allegations the complainant talked about in his complaint:
- Investment Not Processed: He claimed that despite trying to invest in the Parag Parikh Mutual Fund through Groww, the investment was not processed or units were not allocated as expected.
- Missing Funds: The user reported that funds were withdrawn from their bank account for the investment, but no related investment was found with Parag Parikh Mutual Fund company.
- Customer Service Issues: The user also expressed his frustration with Groww’s customer service, describing it as unhelpful in resolving the issue or providing satisfactory explanations despite contacting multiple times.
- Unauthorized OTP Access: Allegations were made regarding unauthorized attempts to access OTPs from mutual fund portals that also raised concerns about data security and integrity.
- Dashboard Error: Groww’s response suggested that the issue derived from a dashboard error that incorrectly reflected a folio, leading to confusion about whether the investment transaction had occurred.
But finally, Groww clarified that no funds were deducted, and attributed the issue to a dashboard error. They are actively working to resolve the problem directly with the customer.
How to Stay Safe and Avoid Scams?
To protect yourself from such scams, it’s important to understand how mutual funds work and how units are allotted to your portfolio. Mutual funds are an investment where you can invest in various assets together without needing to research individual stocks or assets.
Here’s how it works:
- An Asset Management Company (AMC) runs mutual fund schemes. Investing in a mutual fund lets you pool your money with other investors. The AMC appoints a fund manager who is an expert in investing. Each mutual fund scheme has its fund manager, and sometimes a manager oversees multiple funds.
- The AMC then invests this pooled money into different places like stocks, bonds, or other assets. When you withdraw your investment, the AMC may charge a small fee, typically around 1-2% of your returns or principal amount, or both.
- In India, banks and companies like HDFC Bank, Axis Bank, ICICI Bank, Nippon, Parag Parikh, TATA, and Quant have their AMCs with multiple mutual fund schemes.
- There are also mutual funds aggregator platforms like Zerodha Coin and Groww Mutual Fund. These platforms collect money from investors and place orders with AMCs on their behalf. They provide a simple dashboard where you can track how your mutual fund schemes are performing, their charges, details about the fund managers, and more. You can also redeem your funds through these platforms.
- Each AMC assigns a unique folio number for your investments, which you can also view on their respective apps.
- You can also redeem your mutual fund units directly. Simply visit the AMC’s website and log in using the folio number assigned to you.
- When using a mutual fund aggregator such as Zerodha or Groww, it’s important to cross-verify your investments with the respective AMC’s official website or app for added security. For instance, if you invested in HDFC Small Cap Fund, you can easily verify your holdings by visiting https://www.hdfcfund.com/ and logging in with your folio number. This ensures you can see the accurate details of your mutual fund units or funds directly from the source.
So, this is how you can prevent fraudulent transactions, invalid activities, or any kind of issues arising from mutual fund aggregators.
How to Contact Groww to Resolve Your Issues?
If you are facing similar issues then here are some ways that can be used to solve your problems at the earliest:
- Customer Support Ticket: Visit https://groww.in/help to create a support ticket. Make sure to log in with your account details first.
- Phone Support: Call 9108800604 to speak directly with a representative and raise your concerns over the phone.
- Email: Send your complaints or inquiries to [email protected]. This is another effective way to get assistance.
- Social Media: If you’re not satisfied with other channels, use the power of social media and reach out on platforms like Facebook and X (formerly Twitter). Tag Groww in your posts or messages for assistance.
- FAQs: Visit their “Frequently Asked Questions” page to find answers to common queries.
- Discussions/Forums: Join discussions on platforms like Quora and Reddit to talk about your issues and get advice from other users.
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