How to redeem or cancel your SIP

Learn how to effortlessly redeem or cancel your SIP with our step-by-step guide.

EXPLORE FUNDS
4 mins
6 September 2023

There are multiple reasons why you may want to redeem or cancel your Systematic Investment Plan (SIP). These could include external factors like market fluctuations and volatility or personal reasons like the need for funds to make immediate payments, amongst others. At such times, making a decision based on your needs is essential. To understand whether you should redeem or cancel the best SIP in India, you need to understand the difference between the two. Read on to make an informed choice.

Redeeming your SIP

Redeeming your SIP is simply withdrawing your investment to raise money to meet interim or urgent needs. Here, you only sell a part of your investment and not all of it. This means that your SIP is still active even after you redeem held units. The following month, your SIP will continue to purchase units.

If you have bought mutual funds through an AMC (Asset Management Company), you can sign into their portal with your ID and password to perform transactions and redeem money at your convenience. Also, you can request redemption offline by visiting the AMC office and filling up a redemption form.

Ensure that the form is filled with accurate details and has your signature on it. If your form has any discrepancies or your signature does not match your records, your request will get rejected, causing further delay. After submitting your request, you will receive your redemption amount via NEFT or a cheque mailed to your address. You can redeem your SIP similarly even if you have invested via other portals.

If you have purchased your SIP with your Demat or trading account, you will receive an e-pay out to the bank account registered with that account. You will need to submit a redemption request to do the same.

If you hired an agent to invest in SIPs, contact the same agent to redeem it. They will fill up a redemption request with details regarding your SIP, including the number of units that you want to redeem. You will receive the due amount via NEFT or a cheque after the process has been completed.

You can also use Computer Age Management Services (CAMS) to redeem your SIP. Download the redemption form, fill it and submit it at a CAMS office. These requests cannot be cancelled, altered or revoked. However, if you have SIPs with multiple companies, opting for this method is beneficial as it serves as a single point of contact for all your redemption requests.

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Frequently Asked Questions

Can an investor stop all the SIPs at the same time?

Yes, an investor can choose to stop all their SIPs simultaneously.

How long does it take to redeem SIP?

The time taken to redeem your SIP investment can vary depending on the mutual fund house or financial institution. In most cases, SIP redemptions are processed within 3 to 7 business days.

Is there any penalty charged for canceling a SIP?

Cancellation of a SIP typically does not incur a penalty. SIPs offer flexibility, and investors can stop their SIPs at any time without facing a penalty. However, it's essential to be aware that if you redeem your SIP units before the completion of the SIP tenure, you may be subject to exit loads or other charges, depending on the terms and conditions of the specific mutual fund scheme. These charges can vary among different fund houses and schemes, so it's important to review the fund's offer document for details on any applicable exit loads or penalties.

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Disclaimer

Bajaj Finance Limited (“BFL”) is a Non-Banking Financial Company carrying the business of acceptance of deposits, providing lending solutions to Retail & Corporate customers, and is a Corporate agent of various insurance Companies. BFL is also registered with the Association of Mutual Funds in India (“AMFI”) as a distributor of third party Mutual Funds (shortly referred as ‘Mutual Funds’).

BFL does NOT:

(i) provide investment advisory services in any manner or form;

(ii) perform risk profiling of the investor;

(iii) carry customized/personalized suitability assessment;

(iv) carry independent research or analysis, including on any Mutual Fund schemes or other investments; and provide any guarantee of return on investment.


In addition to displaying the Mutual fund products of Asset Management Companies, some general information is sourced from third parties, is also displayed on ‘As-is’ basis, which should NOT be construed as any solicitation or attempt to effect transactions in securities or the rendering any investment advice. Mutual Funds are subject to market risks, including loss of principal amount and Investor should read all Scheme /Offer related documents carefully. The NAV of units issued under the Schemes of mutual funds can go up or down depending on the factors and forces affecting capital markets and may also be affected by changes in the general level of interest rates. The NAV of the units issued under the scheme may be affected, inter-alia by changes in the interest rates, trading volumes, settlement periods, transfer procedures and performance of individual securities. The NAV will inter-alia be exposed to Price / Interest Rate Risk and Credit Risk. Past performance of any scheme of the Mutual fund do not indicate the future performance of the Schemes of the Mutual Fund. BFL shall not be responsible or liable for any loss or shortfall incurred by the investors. There may be other / better alternatives to the investment avenues displayed by BFL. Hence, the final investment decision shall at all times exclusively remain with the investor alone and BFL shall not be liable or responsible for any consequences thereof.

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