ICICI Prudential, Invesco MF announce IDCW payouts: What investors should know

Two mutual fund houses, Invesco Mutual Fund (MF) and ICICI Prudential Mutual Fund, have announced Income Distribution cum Capital Withdrawal (IDCW) payouts for select schemes.

The quantum of IDCW on the face value of ₹10 per unit will be ₹ 0.0692 under Quarterly IDCW and Rs 0.0818 under Direct Plan – Quarterly IDCW.

Invesco MF has approved IDCW in Invesco India Balanced Advantage Fund. The record date for the same is August 04, 2026 or the immediately following Business Day, if that day is a Non-Business Day.

The quantum of IDCW on the face value of ₹10.00 per unit will be ₹0.14 per unit under IDCW Option and under Direct Plan - IDCW Option.

However, before opting for IDCW, investors should understand how these payouts work and how they impact NAV.

IDCW allows MF investors to receive periodic payouts from their investments. Earlier known as the dividend option, IDCW was renamed by the market regulator SEBI in April 2021. The change was made to avoid confusion between dividends paid by companies on stocks and payouts made by mutual funds.

Under the IDCW option, a mutual fund may distribute a portion of its available surplus to investors instead of reinvesting it back into the scheme.

How does IDCW work?

When a mutual fund earns returns, the fund house can either reinvest those gains into the scheme or distribute a portion of them to investors as IDCW.

Investors can choose IDCW payout frequencies such as monthly, quarterly or yearly, depending on the option available in the scheme.

However, IDCW payouts are not the same as guaranteed income. The amount paid out comes from the scheme’s NAV, which reduces to the extent of the payout. Tax treatment of IDCW also depends on the investor’s applicable tax rules and is not treated the same way as a fixed-income return.