How to Discontinue a Mutual Fund SIP?

How to Cancel SIP Online?

You may discontinue your SIP through online or offline means. Cancelling your SIP online is simple and hassle-free. You have the option of cancelling your SIP through your MF house or directly with the KYC Registration Agency (KRA) like Karvy, CAMS, etc. CVL KRA, NSDL KRA, NSE KRA, Karvy KRA, and CAMS KRA are different KRAs in India.

SIP Cancellation through CAMS KRA

Step 1: Visit https://mycams.camsonline.com/ and log into your account.

Step 2: Choose 'My Transactions' from the menu bar at the top.

Step 3: Select the ‘Systematic Transactions’ option and click on the ‘active’ option.

Step 4: The active systematic transactions will be displayed on the screen.

Step 5: Click on the ‘Cancel’ option.

If there is no cancel button, either the SIP was not created using CAMs, or the asset management company does not permit online cancellations.

SIP Cancellation through Karvy

Step 1: Visit the Karvy website and click on the ‘Mutual Fund Investor Services’ option. 

Step 2: From the Downloads section, click on the 'Services' option. 

Step 3: Go to the 'Services' section and click on the ‘SIP/STP/SWP cancellation request’ option. 

SIP Cancellation through AMC

Step 1: Go to the asset management company's website, for which the SIP is still active.

Step 2: For website login purposes, you will require the folio number, PAN, and bank account number linked to the folio.

Step 3: Select the SIP that is currently in progress that you want to cancel and select the ‘Cancel SIP’ option.

Step 4: The cancellation process will require about 21 days.

How to Stop ECS for Your SIPs?

You can also discontinue the automated ECS payments for your SIP payments by deleting your asset management company from your bank account as a biller. This way, no amount will be deducted for your investment folio. If the ECS debits are not successfully done for a fixed number of times, the SIP scheme will be terminated automatically.

Steps to Stop Your SIP Offline

1. Step 1: First, you will need to inform your mutual fund company as well as the bank via which your investment is made on a monthly basis, regarding your plan to discontinue the scheme.
2. Step 2: Next, you will need to obtain an appointment form from asset management companies (AMCs) or Registrar and Transfer Agents of mutual funds.
3. Step 3: In this form, you will be required to key in information such as your bank account details, name of your SIP scheme, folio number, and SIP amount. You will then have to specify from when you want your scheme to be discontinued.
4. Step 4: Next, you will have to submit the fully filled form at the branch of an AMC or Registrar and Transfer Agents.
5. Step 5: The AMC will take approximately 21 days to handle your cancellation request. This could differ from fund house to fund house. The standing instruction for the SIP payment to the bank will also need to be cancelled.
6. Step 6: If the AMC has received an SIP instruction along with post-dated cheques for the SIP payment, then the post-dated cheques that are not used will be sent back to the unitholder by the AMC.

How to Stop Your SIP Temporarily?

If you are in need of money for a brief period of time, you can simply pause your SIPs rather than cancelling them. The steps to pause an SIP are as follows:

Step 1: Contact your bank and request that they remove the option for your SIP payments to be deducted automatically.

Step 2: Get in touch with the bank and inform them of your plans to resume SIP payments.

However, an SIP can be put on hold for a maximum of two months. After that, the AMC will automatically terminate the SIP if you don't initiate the bank to restart the SIP. Thus, you must refrain from missing more than two months' SIP payments.

You must understand how to stop a mutual fund SIP if you have an active SIP and invest in mutual funds every month. Knowing the procedure is essential because there's a chance that you may require access to your funds immediately. In case the market is underperforming, you might also wish to terminate a SIP.

Therefore, before you cancel your mutual fund SIP, think about other options. It is necessary that you weigh all of your options and select an easy way to cancel your SIPs. You must review the SIP cancellation fees prior to submitting your request.

Reasons Why Investors Pause or Cancel Mutual Fund SIP

There are various reasons for investors to decide to stop or pause their SIP. Here are some of the most common causes why investors considering cancelling or pausing their SIPs:

1. In the event of market fluctuations, investors may wish to liquidate their mutual fund investments. They may therefore want to stop their active SIPs in order to prevent losses.
2. An investor would like to cancel the SIP if the fund's primary objective shifts. Therefore, there may be a negative effect on the rate of returns.
3. In the event of a financial emergency or a requirement for money for an urgent matter, an investor may wish to cancel the SIP.
4. If a mutual fund underperforms over an extended period of time, investors might consider withdrawing it.
5. Sometimes, if the fund manager changes, the fund's investment strategy may also change. In such cases, investors cancel their SIP to protect themselves from these external factors.