Can I Cancel my SIP before the tenure??

Query of Blog Reader:  Cancellation of SIP in midway

I had enrolled for SIP in mutual fund scheme for 36 months. I have completed only 10 months. At this point is it possible to cancel the SIP?

Do I lose any money because of this?
How to cancel my ongoing sip?
Whether i have to pay any charges or penalty for discontinuing the SIP in midway??

I have online access to my mutual fund scheme, whether i can apply online to cancel my SIP, as i am not finding any option online?? (my current sip is created off-line means by submitting sip auto debit form)

I need your help in drafting letter for cancellation of sip if online option is not available for termination of my sip.

Please help me as how to proceed?

Reply
Yes, you can cancel your ongoing sip after 10 months and before 36 months as SIP is a voluntary investment, the AMC cannot levy any charges or penalty for discontinuing the SIP midway.

 Important point here is that discontinuation request should be given at least 30 days prior to the next due date of SIP. (some mutual fund houses take 45 days prior notice, as period differ from AMC to AMC)

Example:

Suppose your sip date is 5th of every month and you have given request on 15th of this month(October), so in this case, sip for November will  get debited (deducted) from your bank account, but their will not be any deduction in month of December.

Also refer

How to make changes in bank details in ongoing SIP?

Do you lose any money if you cancel sip before the tenure?

No,  AMC don't charge you anything, but, if along with cancellation of sip, you withdraw (redeem all units), then in such case amc may charge exit load, if applicable on such scheme.

Whether request will get accepted online in your case?
No, you have to submit written request in physical form and submit to mutual fund office or cams or karvy.As you mentioned above, your current sip is done by auto debit (offline) mode, then in such case you need to submit written request or sip cancellation form in physical mode.

Now how to cancel your Mutual Fund SIP 

An investor can cancel an existing SIP registered through ECS or Auto debit mode with mutual fund by submitting SIP Cancellation request  or written request.

If the SIP was started through an online platform, the cancellation can also be done through the same platform.

SIP Cancellation forms are available with AMCs or registrar and transfer agents.

You need to fill following details in sip cancellation form
1. Folio number
2. Scheme name and Plan
3. Sip amount and sip date
4. Bank account details 

Also refer:

Insufficient funds in your bank account on SIP due date!!

SIP Cancellation format:

Cancellation of Systematic Investment Plan

                                                                                                   

                                                                                                                 Date:

To,                                                                                                            

…………………………………………

…………………………………………

 Dear Sir,

 

I/we had given an instruction for deduction of Rs. -------------- into the following mutual fund scheme:

Folio Number:  --------------------------------------------

Scheme Details: --------------------------------------------

SIP Debit Date: ---------------------------------------------

Investor Bank Details

Bank Name: ---------------------------------------------------

Account No. ----------------------------------------------------

Due to some reason, I/we wish to discontinue my SIP in above mentioned fund.

I/we request you to cancel/stop deducting the sip amount registered with you from my /our above account from the ensuring month…………………………..

Hereby, I request you to kindly stop further SIP installment recovery of Rs.-------------

Kindly forward this instruction to my banker.

Your truly,

 

 

………………………

 Sip Cancellation form in (word document)