{"id":10364,"date":"2025-05-15T10:16:25","date_gmt":"2025-05-15T10:16:25","guid":{"rendered":"https:\/\/navia.co.in\/blog\/?p=10364"},"modified":"2025-08-12T13:16:59","modified_gmt":"2025-08-12T13:16:59","slug":"idcw-vs-growth-what-is-the-difference","status":"publish","type":"post","link":"https:\/\/navia.co.in\/blog\/idcw-vs-growth-what-is-the-difference\/","title":{"rendered":"IDCW Vs Growth: What is the Difference?\u00a0"},"content":{"rendered":"\n<div class=\"wp-block-rank-math-toc-block\" id=\"rank-math-toc\"><nav><ul><li class=\"\"><a href=\"#what-is-idcw-in-mutual-funds\">What is IDCW in Mutual Funds?\u00a0<\/a><ul><\/ul><\/li><li class=\"\"><a href=\"#what-is-growth-in-mutual-funds\">What is Growth in Mutual Funds?\u00a0<\/a><ul><\/ul><\/li><li class=\"\"><a href=\"#idcw-vs-growth-in-mutual-funds\">IDCW vs Growth in Mutual Funds\u00a0<\/a><\/li><li class=\"\"><a href=\"#growth-vs-idcw-which-is-better\">Growth Vs IDCW \u2013 Which is Better?\u00a0<\/a><\/li><li class=\"\"><a href=\"#conclusion\">Conclusion<\/a><\/li><li class=\"\"><a href=\"#frequently-asked-questions\">Frequently Asked Questions<\/a><\/li><\/ul><\/nav><\/div>\n\n\n\n<p>If you are planning to invest in <a href=\"https:\/\/navia.co.in\/blog\/category\/mutual-funds\/\">mutual funds<\/a>, it is necessary to understand the well-known types of funds available in the market. They are IDCW (Income Distribution cum Capital Withdrawal) and the other one is Growth. There are so many differences between these funds like duration, functionality and many more. This blog will guide you to understanding the <strong>difference between growth and IDCW in mutual funds<\/strong> that lead you to long-term financial goals.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-69fe2ac9ba14e8b1a2fb440af49e3c2c\" id=\"what-is-idcw-in-mutual-funds\" style=\"color:#023368\">What is IDCW in Mutual Funds?&nbsp;<\/h2>\n\n\n\n<p><a href=\"https:\/\/navia.co.in\/blog\/what-is-idcw-in-mutual-funds\/\">IDCW<\/a> is the abbreviation of Income Distribution cum Capital Withdrawal. It\u2019s an option in mutual funds where investors receive payouts at intervals as decided by the fund house. The payouts can be in two forms, one is, profits\/income that generated by the scheme another one is part of the investor\u2019s own invested capital.&nbsp;&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"key-features\"><strong>Key Features;<\/strong>&nbsp;<\/h3>\n\n\n\n<p>\ud83e\udc16 Investors receive money at different intervals.&nbsp;<\/p>\n\n\n\n<p>\ud83e\udc16 After each distribution of money, the fund\u2019s Net Asset Value (NAV) will decrease.&nbsp;<\/p>\n\n\n\n<p>\ud83e\udc16 There is no guarantee of payouts because it depends on the fund performance.&nbsp;<\/p>\n\n\n\n<p>\ud83e\udc16 Suitable for investors who are looking for regular income.&nbsp;&nbsp;<\/p>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-16018d1d wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link has-white-color has-text-color has-background has-link-color wp-element-button\" href=\"https:\/\/navia.co.in\/app.html\" style=\"background-color:#ec4d37\"><strong>Get Navia APP<\/strong><\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-1d7e5affcb6b97105f4db3e00d5472df\" id=\"what-is-growth-in-mutual-funds\" style=\"color:#023368\">What is Growth in Mutual Funds?&nbsp;<\/h2>\n\n\n\n<p>Growth is the opposite of IDCW, because the fund doesn\u2019t distribute any income to the investors. Instead, all earnings like dividends and capital gains are reinvested into the scheme.&nbsp;&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"key-features-1\"><strong>Key Features;<\/strong>&nbsp;<\/h3>\n\n\n\n<p>\ud83e\udc16 No payouts so return are reflected in the rise in Net Asset Value.&nbsp;<\/p>\n\n\n\n<p>\ud83e\udc16 It is ideal for achieving long-term goals.&nbsp;<\/p>\n\n\n\n<p>\ud83e\udc16 Tax-efficient fund because of the long run.&nbsp;<\/p>\n\n\n\n<p>\ud83e\udc16 Suitable for <a href=\"https:\/\/navia.co.in\/blog\/category\/investments\/\">investors<\/a> who don\u2019t need regular income and aim for long-term wealth creation.&nbsp;&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-9bc3825e3401fc0dbc1d0db012bd84e9\" id=\"idcw-vs-growth-in-mutual-funds\" style=\"color:#023368\">IDCW vs Growth in Mutual Funds&nbsp;<\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Criteria<\/strong>&nbsp;<\/td><td><strong>IDCW (Income Distribution cum Capital Withdrawal)<\/strong>&nbsp;<\/td><td><strong>Growth<\/strong>&nbsp;<\/td><\/tr><tr><td>Distribution of income&nbsp;<\/td><td>Periodic payouts&nbsp;<\/td><td>No payouts&nbsp;<\/td><\/tr><tr><td>Net Asset Value&nbsp;<\/td><td>After each payouts NAV decreases&nbsp;<\/td><td>NAV increases over time&nbsp;<\/td><\/tr><tr><td>Taxation&nbsp;<\/td><td>Taxable in the year of distribution&nbsp;<\/td><td>Taxable only on redemption&nbsp;<\/td><\/tr><tr><td>Investment goals&nbsp;<\/td><td>Passive investors who seeking regular income&nbsp;<\/td><td>Long-term wealth builders&nbsp;<\/td><\/tr><tr><td>Example&nbsp;<\/td><td>You invest \u20b91,00,000 in the IDCW scheme. The fund earns a 10% return in year, which means \u20b910,000 profit.&nbsp;&nbsp;&nbsp;The fund decides to distribute \u20b96,000 as income (dividend). The remaining \u20b94,000 stays in the fund.&nbsp;&nbsp;Now your investment value is \u20b91,04,000, and you receive \u20b96,000 in your bank account.&nbsp;<\/td><td>You invest \u20b91,00,000 in the Growth scheme. The fund earns a 10% return in year, which means \u20b910,000 profit.&nbsp;&nbsp;&nbsp;The \u20b910,000 profit is not paid out to you. It is reinvested back into the fund.&nbsp;&nbsp;&nbsp;Now your investment grows to \u20b91,10,000. No cash in hand until you redeem your units.&nbsp;&nbsp;&nbsp;<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<figure class=\"wp-block-image size-full\"><a href=\"https:\/\/open.navia.co.in\/index-navia.php\"><img fetchpriority=\"high\" decoding=\"async\" width=\"1024\" height=\"149\" src=\"https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/03\/OPEN-DEMAT-ACC.png\" alt=\"idcw vs growth\" class=\"wp-image-9412\" srcset=\"https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/03\/OPEN-DEMAT-ACC.png 1024w, https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/03\/OPEN-DEMAT-ACC-300x44.png 300w, https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/03\/OPEN-DEMAT-ACC-150x22.png 150w, https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/03\/OPEN-DEMAT-ACC-768x112.png 768w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/a><\/figure>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-8720d8e1decb94b02181dffcd8c7c13f\" id=\"growth-vs-idcw-which-is-better\" style=\"color:#023368\">Growth Vs IDCW \u2013 Which is Better?&nbsp;<\/h2>\n\n\n\n<p><strong>IDCW vs Growth mutual funds, <\/strong>which is better, is a tricky question. Because each one has unique features and advantages, but you can choose it according to your financial goals and income needs.&nbsp;<\/p>\n\n\n\n<p>The major <strong>difference between IDCW and Growth<\/strong> is how the returns are distributed to the investors. If you are seeking a regular income, you must choose IDCW, and your goal is achieving long-term wealth creation, Growth is the best option. However, selecting the best one completely depends on the investor\u2019s needs.&nbsp;&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-5c6c27297d730fa3a4d2ea0f4ae98e8a\" id=\"conclusion\" style=\"color:#023368\">Conclusion<\/h2>\n\n\n\n<p>Before investing in mutual funds, you have to evaluate your financial goals, tax implications, time horizon and also the <strong>IDCW and growth difference<\/strong>. Because both IDCW and Growth offer a variety of benefits to the investors. For the investors who are looking for consistent income they can choose IDCW and for the investors who want to grow their wealth over time can choose Growth option.&nbsp;&nbsp;<\/p>\n\n\n\n<p>If you are in doubt about finding the best one for you consult a financial advisor or use a trusted investment platform like <strong><a href=\"https:\/\/navia.co.in\/\">Navia<\/a> <\/strong>to make informed decisions.&nbsp;<\/p>\n\n\n\n<p class=\"has-text-align-center\"><strong>Do You Find This Interesting?<\/strong><\/p>\n\n\n\n<div class=\"wp-block-group is-nowrap is-layout-flex wp-container-core-group-is-layout-ad2f72ca wp-block-group-is-layout-flex\">\n<p>We\u2019d Love to Hear from you-<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><a href=\"https:\/\/form.typeform.com\/to\/bpQ8ZlDc\"><img decoding=\"async\" width=\"300\" height=\"64\" src=\"https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/02\/Yes-No-Button-1.png\" alt=\"feedback yes or no button\" class=\"wp-image-8901\" srcset=\"https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/02\/Yes-No-Button-1.png 300w, https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/02\/Yes-No-Button-1-150x32.png 150w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a><\/figure>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading has-text-color has-link-color wp-elements-9a07b674a5b87db9730c3cf59dbbb76b\" id=\"frequently-asked-questions\" style=\"color:#023368\">Frequently Asked Questions<\/h2>\n\n\n<div class=\"wp-block-ub-content-toggle wp-block-ub-content-toggle-block\" id=\"ub-content-toggle-block-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" data-mobilecollapse=\"false\" data-desktopcollapse=\"false\" data-preventcollapse=\"false\" data-showonlyone=\"false\">\n<div class=\"wp-block-ub-content-toggle-accordion\" style=\"border-color: #f1f1f1; \" id=\"ub-content-toggle-panel-block-\">\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-title-wrap\" style=\"background-color: #f1f1f1;\" aria-controls=\"ub-content-toggle-panel-0-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" tabindex=\"0\">\n\t\t\t<p class=\"wp-block-ub-content-toggle-accordion-title ub-content-toggle-title-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" style=\"color: #000000; \"><strong>What is the main difference between IDCW and Growth options?<\/strong><\/p>\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-toggle-wrap right\" style=\"color: #000000;\"><span class=\"wp-block-ub-content-toggle-accordion-state-indicator wp-block-ub-chevron-down open\"><\/span><\/div>\n\t\t<\/div>\n\t\t\t<div role=\"region\" aria-expanded=\"true\" class=\"wp-block-ub-content-toggle-accordion-content-wrap\" id=\"ub-content-toggle-panel-0-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\">\n\n<p>IDCW pays the investor the part of profits as a regular income, while Growth reinvests all profits to increase the fund value over time.<\/p>\n\n<\/div>\n\t\t<\/div>\n\n<div class=\"wp-block-ub-content-toggle-accordion\" style=\"border-color: #f1f1f1; \" id=\"ub-content-toggle-panel-block-\">\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-title-wrap\" style=\"background-color: #f1f1f1;\" aria-controls=\"ub-content-toggle-panel-1-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" tabindex=\"0\">\n\t\t\t<p class=\"wp-block-ub-content-toggle-accordion-title ub-content-toggle-title-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" style=\"color: #000000; \"><strong>Is IDCW taxable?<\/strong>\u00a0<\/p>\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-toggle-wrap right\" style=\"color: #000000;\"><span class=\"wp-block-ub-content-toggle-accordion-state-indicator wp-block-ub-chevron-down open\"><\/span><\/div>\n\t\t<\/div>\n\t\t\t<div role=\"region\" aria-expanded=\"true\" class=\"wp-block-ub-content-toggle-accordion-content-wrap\" id=\"ub-content-toggle-panel-1-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\">\n\n<p>Yes. Because it is added to your income and taxed as per your income slab.\u00a0\u00a0<\/p>\n\n<\/div>\n\t\t<\/div>\n\n<div class=\"wp-block-ub-content-toggle-accordion\" style=\"border-color: #f1f1f1; \" id=\"ub-content-toggle-panel-block-\">\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-title-wrap\" style=\"background-color: #f1f1f1;\" aria-controls=\"ub-content-toggle-panel-2-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" tabindex=\"0\">\n\t\t\t<p class=\"wp-block-ub-content-toggle-accordion-title ub-content-toggle-title-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" style=\"color: #000000; \"><strong>Does Growth option have any tax?<\/strong>\u00a0<\/p>\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-toggle-wrap right\" style=\"color: #000000;\"><span class=\"wp-block-ub-content-toggle-accordion-state-indicator wp-block-ub-chevron-down open\"><\/span><\/div>\n\t\t<\/div>\n\t\t\t<div role=\"region\" aria-expanded=\"true\" class=\"wp-block-ub-content-toggle-accordion-content-wrap\" id=\"ub-content-toggle-panel-2-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\">\n\n<p>Yes, if you redeem your unit&#8217;s capital gains tax will be applicable.\u00a0\u00a0<\/p>\n\n<\/div>\n\t\t<\/div>\n\n<div class=\"wp-block-ub-content-toggle-accordion\" style=\"border-color: #f1f1f1; \" id=\"ub-content-toggle-panel-block-\">\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-title-wrap\" style=\"background-color: #f1f1f1;\" aria-controls=\"ub-content-toggle-panel-3-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" tabindex=\"0\">\n\t\t\t<p class=\"wp-block-ub-content-toggle-accordion-title ub-content-toggle-title-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" style=\"color: #000000; \"><strong>Which option gives better returns?<\/strong>\u00a0<\/p>\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-toggle-wrap right\" style=\"color: #000000;\"><span class=\"wp-block-ub-content-toggle-accordion-state-indicator wp-block-ub-chevron-down open\"><\/span><\/div>\n\t\t<\/div>\n\t\t\t<div role=\"region\" aria-expanded=\"true\" class=\"wp-block-ub-content-toggle-accordion-content-wrap\" id=\"ub-content-toggle-panel-3-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\">\n\n<p>Growth usually gives better long-term returns due to compounding, provided no regular income NAV is needed.\u00a0\u00a0<\/p>\n\n<\/div>\n\t\t<\/div>\n\n<div class=\"wp-block-ub-content-toggle-accordion\" style=\"border-color: #f1f1f1; \" id=\"ub-content-toggle-panel-block-\">\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-title-wrap\" style=\"background-color: #f1f1f1;\" aria-controls=\"ub-content-toggle-panel-4-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" tabindex=\"0\">\n\t\t\t<p class=\"wp-block-ub-content-toggle-accordion-title ub-content-toggle-title-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\" style=\"color: #000000; \"><strong>Is NAV different for IDCW and Growth plans?<\/strong><\/p>\n\t\t\t<div class=\"wp-block-ub-content-toggle-accordion-toggle-wrap right\" style=\"color: #000000;\"><span class=\"wp-block-ub-content-toggle-accordion-state-indicator wp-block-ub-chevron-down open\"><\/span><\/div>\n\t\t<\/div>\n\t\t\t<div role=\"region\" aria-expanded=\"true\" class=\"wp-block-ub-content-toggle-accordion-content-wrap\" id=\"ub-content-toggle-panel-4-584259b0-7e7b-48a4-afeb-acf0e6cd4fdf\">\n\n<p>Yes, Growth is generally higher since returns are reinvested, while IDCW NAV may drop after each payout.<\/p>\n\n<\/div>\n\t\t<\/div>\n<\/div>\n\n\n<p><strong>DISCLAIMER: Investments in the securities market are subject to market risks, read all the related documents carefully before investing. The securities quoted are exemplary and are not recommendatory. Brokerage will not exceed the SEBI prescribed limit.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>If you are planning to invest in mutual funds, it is necessary to understand the well-known types of funds available in the market. They are IDCW (Income Distribution cum Capital Withdrawal) and the other one is Growth. There are so many differences between these funds like duration, functionality and many more. This blog will guide [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":10369,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[209],"tags":[11,548,545,21,22,23,32],"class_list":["post-10364","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mutual-funds","tag-financial-goals","tag-growth","tag-idcw","tag-investments","tag-investor","tag-mutual-funds","tag-wealth-creation"],"featured_image_src":"https:\/\/navia.co.in\/blog\/wp-content\/uploads\/2025\/05\/IDCW-vs-Growth-1.png","author_info":{"display_name":"Navia Markets","author_link":"https:\/\/navia.co.in\/blog\/author\/tradeplusonline\/"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/posts\/10364","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/comments?post=10364"}],"version-history":[{"count":6,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/posts\/10364\/revisions"}],"predecessor-version":[{"id":12452,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/posts\/10364\/revisions\/12452"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/media\/10369"}],"wp:attachment":[{"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/media?parent=10364"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/categories?post=10364"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/navia.co.in\/blog\/wp-json\/wp\/v2\/tags?post=10364"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}