How do I cancel a SIP? How to discontinue a SIP? How long does the cancellation take? Do I need to intimate Mutual Fund company? What if I remove them as biller from my online banking account?
Table of Contents
How to cancel a SIP?
SIP or systematic investment plan is a commitment to invest for a specific period in a selected mutual fund scheme. In Perpetual SIP you can keep investing as long as you wish to without any end date(99 years). But there may be a need to discontinue the SIP because you have less money or you are not happy with SIP’s performance.
As SIP is a voluntary investment, you can discontinue it any time. The Mutual fund company cannot charge any penalty for discontinuing the SIP midway. The mutual fund and the bank through which the funds for the periodic investment are being provided, have to be intimated about the decision to discontinue the SIP.
- If you have invested in SIP through online platforms such as AMC Website, CAMS, Karvy, MFUtility, ETMoney, Coin Zerodha, Groww you can cancel it online anytime through the same platform.
- If you have invested offline through a distributor you need to submit a SIP closure Form. Fill the form issued by the asset management company (AMC). You have to mention the date from which you like to discontinue the SIP. Submit the form to the AMC. It may take up to 21 days to discontinue a SIP.
- If you have NACH activated, then If you remove asset management company as a biller from your bank account, there would be no further investment into your folio.
- If the account is under-funded or stop payment instructions are given for more than two months, the AMC will discontinue the SIP.
- If you have invested in SIP for a specific period then after the completion of the period the SIP stops.
- It is not necessary to redeem the money after SIP cancellation.
- As you are stopping the investment, there is no tax involved. Mutual Funds (in Lump sum/SIP) taxed on selling or switching.
Pause or Temporary stop of SIP
SIP can be paused for some time through online platform
If the SIP has to be discontinued temporarily, the investor can give a stop payment instruction to the bank or keep a low balance in the account, which will lead to the cheque or instruction being dishonoured. The SIP can be continued after this period.
When should you Stop the SIP?
Many investors decide to stop their SIP and exit mutual funds when the stock markets fall. You should actually increase your SIP amount and buy more fund units when the stock markets fall. Investing in SIPs with a long-term horizon mitigates market risk and volatility. However, many investors do not think this way, and they stop their ongoing SIPs.
How to Cancel SIP on Zerodha Coin?
To cancel your SIP, Go to the Orders tab from the home page and select SIP & Conditional. Here click on the fund in which you want to cancel the SIP. Then click on the ‘round blue + icon. Click on the Delete icon. The image below shows how to Cancel SIP on Zerodha Coin platform
How to Cancel SIP on Groww App?
You can stop an SIP simply by going to ‘My SIP’ and clicking in ‘Cancel’.
How To Obtain SIP Cancellation Form From Cams
You need to take the filled form to CAMS RTA local office or AMC office and submit the application
- Visit camsonline.com and go to the Investor Services Tab.
- On the left-hand side click on Service Request Forms
- Under “ Non Financial Transaction Request” select SIP/SWP/STP Cancellation request
- Tick the SIP box to place cancellation request. You can select the mutual fund from the drop-down list. Enter the relevant details and press next.
- Fill in the other details and print the form. You need to take the filled form to CAMS RTA local office or AMC office and submit the application. Upon submission of application, you will be given the acknowledgment receipt.
How To Obtain SIP Cancellation Form From Karvy
- Go to https://www.karvymfs.com/karvy/
- Click on Mutual Fund Investor Services
- Under the ” Downloads” section, click on ” Services”
- Scroll down to reach the ” services ” section and click on SIP/STP/SWP cancellation request
- You will be able to download the SIP Cancellation Form
- Take the duly filled form to Karvy RTA local office or AMC office and submit. Do not forget to collect the acknowledgment receipt
SIP Cancellation Form
The sample SIP Cancellation form is given below. You need to download the Cancellation form from the Mutual Fund website. You need to enter Folio Number and SIP Details. In case of joint holders in the folio the form needs to be signed by either one of the holder or all the holders depending upon the mode of holding.
How to Close NACL to cancel SIP?
If you have activated NACH/ECS(Electronic clearing Systems) for SIP payments, then you should inform the bank through which payments are made to deactivate the ECS and then inform the mutual fund house. A SIP would be terminated when the payments are not made for a certain number of times.
For example for Kotak Mahindra Bank, Following options are available to check details of active ECS or NACH
- Login to Net Banking/Mobile Banking
- If logged on to Net Banking/Go to Banking
- Go to Service Request -> New Service Request
- Savings & Current Account -> NACH cancellation (active NACH will be shown)