How to Stop or Cancel Mutual Fund SIP Online

One of the biggest features of mutual fund investments is the SIPs. It allows the investors the flexibility to invest an amount suitable to their needs and investment goals without disrupting their financial stability. Investors also have the flexibility to increase, decrease or stop their SIPs due to evolving financial conditions. Are you looking to stop your SIPs? Then, this blog answers one of the simplest but crucial questions: how to stop SIP. Read on to learn the process for online SIP cancellation and more. 

How to Stop SIP Online?

A SIP can be cancelled in multiple ways. The process is quite simple and can be executed easily online.

Through the AMC Website

• Investors can start by visiting the official website of the mutual fund house where the SIP is active.

• The next step is to log in using their credentials (such as username and password).

• Once logged in, investors must locate the specific SIP to be cancelled and select the "Cancel SIP" option.

• The SIP will typically be discontinued within 21 working days after processing the request.

Through an Online Distributor Platform

• If the SIP was set up through an online distributor mutual fund platform like FYERS Direct, the investor can log in to such platform for cancellation of the SIP. 

• Investors have to select the specific SIP they want to stop from the mutual fund section.

• The next step is to click on the "Cancel" or "Stop SIP" option to terminate the SIP.

• The platform will process the request, and the SIP will be cancelled accordingly.

Through an Agent

• If the SIP was initiated with the help of an agent, the investor can inform them of their intention to cancel the SIP.

• The agent will then submit the cancellation request to the relevant AMC on behalf of the investor.

• The agent will manage the entire process, ensuring that the SIP is stopped as requested.

How to Stop Mutual Fund SIP Temporarily?

When you start a SIP, you authorise your bank to auto-debit a specific amount regularly. This continues until you pause, modify, or stop the SIP. 

However, unforeseen financial challenges can arise over time, making it difficult to maintain the SIP contributions regularly. In such cases, the bank can levy a penalty for insufficient funds if you cannot meet the SIP mandate duly. 

Additionally, if the SIP payment is missed for over two months, the Asset Management Company (AMC) might cancel your SIP. This could lead to a loss of potential returns, and if you redeem the SIP before the lock-in period ends, you may also face an exit load.

To avoid these consequences, you can opt to temporarily pause your SIP. This option allows you to take a financial breather and resume your SIP once you're back on track.

Here are some key points to consider before pausing your SIP:

• Pause Limit - Most AMCs allow you to pause your SIP up to twice during the SIP tenure. The pause can last from a minimum of 1 month to a maximum of 3 to 6 months, depending on the AMC's guidelines. The ability to pause or modify your SIPs can also depend on the broker/platform you use to subscribe to mutual fund investments.

After adhering to these conditions, the steps to pause the SIP are- 

• Visit the official website or app of the AMC or the broker’s platform.

• Use valid credentials (username and password) to log in to the account.

• Once logged in, find the section labelled ‘SIP’ or ‘Systematic Investment Plans’ under the tab ‘Investments’ ‘My SIPs’ or "Portfolio."

• A list of active SIPs will be displayed and investors will have to select the SIP they wish to pause and click on it.

• The SIP details section will have an option to “Pause SIP” or “Modify SIP.” Click on the ‘Pause SIP’ option.

• Investors also have to provide the duration for which the SIP is to be paused. Provide the start and end dates within the allowed limit (usually 1 to 3 or 6 months).

• Review the details and click on ‘Submit’ to proceed.

• Investors will receive a confirmation message or email from the AMC and/or platform used for the request as acknowledgement.

How to Stop SIP Offline?

While the online option for the cancellation of SIP is quite convenient, investors can also cancel their SIPs through the offline mode. Here are the steps for the same. 

• The investor needs to reach out to the AMC managing their mutual fund or the Registrar and Transfer Agents (RTAs) like CAMS or KFintech

• The investor should request the SIP Cancellation Form at the AMC’s office or the RTA.

• The investor must fill in all the necessary details on the form accurately. This includes,

  • Folio number

  • Name of the mutual fund scheme

  • Bank account details linked to the mutual fund

  • SIP amount

  • Desired end date for the SIP payments

• After completing the form, the investor should submit it to the AMC or RTA office.

• The AMC will process the cancellation request, which typically takes up to 21 days. 

• The investor must also visit their bank to cancel the ECS mandate, which authorises the SIP deductions.

• After cancelling the auto-debit mandate at the bank, the investor should obtain written confirmation from the bank.

• This confirmation must then be submitted to the AMC to ensure the biller is removed from the system.

• Once all these steps are completed, the SIP will be fully canceled, and no further deductions will be made from the investor’s account.

Conclusion

Mutual funds offer investors the flexibility to cancel their SIPs at their convenience or even pause them for a brief period. Stopping a SIP, whether online or offline, involves a simple process which is executed through multiple forums like AMC, the broker’s platform or an agent and executed in a maximum of 21 days. The flexibility to stop or pause SIPs allows investors better control over their investment portfolio to ensure financial stability.