SIP Cancellation Form: Many mutual fund companies are offering a Systematic Investment Plan (SIP) to their investors. With the help of this plan, investors can invest a small amount instead of investing a lump sum. Nowadays, most investors prefer to invest through this plan, but they have certain questions or doubts regarding the cancellation of this plan. Certain questions like How do I cancel a SIP? How to discontinue a SIP? How long does the cancellation take? comes to the investor’s mind. Through this article, we will try to clear some of their doubts so that they can invest without having any fears.
How to Cancel a SIP?
SIP or Systematic Investment Plan is considered as a commitment to invest for a specific amount of time under a particular mutual fund scheme. In the case of perpetual SIP, one can invest as long as he/she wishes as they don’t have any end date. But sometimes, people lose their interest in these kinds of investments because of having less money to invest or due to poor performance of SIP, and they want to discontinue their plan as soon as possible.
As SIP is considered a voluntary investment, one has the right to discontinue it whenever the need arises. The mutual fund company didn’t have the right to charge any cancellation fees for discontinuing the SIP midway. The mutual fund company and the bank through which funds are provided for the periodic investment have to be informed about the discontinuation of the SIP.
Different Ways of Cancelling the SIP
- If a person has invested in SIP through an online platform such as AMC Website, CAMS, Karvy, MFUtility, ETMoney, Coin Zerodha and Groww, then he/she can cancel the plan anytime through the official website of the company.
- If a person has invested in SIP through a distributor, then he/she has to fill up a SIP Closure Form. This form is issued by the Asset Management Company. One must put the exact date on the form from when he/she wants to discontinue the SIP. After filling it up, submit it to the AMC. It might take approximately 21 days for the cancellation or discontinuation of the SIP.
- If the person investing through SIP has activated NACH, then he/she only needs to remove the Asset Management Company as a biller from his/her bank. After these actions, no further investment will take place in his/her folio.
- If a person’s account is considered underfunded or stops payment instructions have been forwarded for more than 2 months, then AMC has all the rights to discontinue the SIP.
- A person who has invested in the SIP for a specific period then after the expiry of the period the SIP stops automatically.
- There is no need of redeeming the money once the SIP is cancelled.
- Cancellation of SIP attracts no tax because, in this case, one is stopping the investment; thus, taxes are exempted.
Pause or Temporary Stop of SIP
If a person is investing in SIP through an online platform, then he/she can easily pause it whenever the need arises. If an investor wants to stop the SIP temporarily, then he/she needs to give a stop payment instruction to the bank or maintain a low balance in the bank account. This will lead to the cheque being dishonoured. One can continue to invest in the same SIP after this period.
When Should You Stop The SIP?
People seem to stop investing in SIP and decide to discontinue it when the stock market falls. But during these times, one should invest more and increase the SIP amount so that he/she can earn some huge profits in the long run. SIP with a long-term horizon mitigates market risk and volatility. But most of the investors get afraid and stop their investment in SIP.
SIP Cancellation Form
A SIP cancellation form is used to collect the details of the investor who wants to discontinue or cancel the SIP. Through this form, the mutual fund company gets to know the date when the investor is planning to stop the SIP. One can download this form from the official website of the mutual fund company. In case the SIP has joint holders, then the form needs to get signed by either one of the holders or by all the holders depending upon the mode of holding. Let’s discuss the way of obtaining SIP cancellation form from two companies:
How to Obtain SIP Cancellation Form From Cams
- Visit the official website of Cams, i.e., camsonline.com and go click on the Tab “Investors Services”
- Click on “Service Request Forms”, which you can find on the left-hand side of the webpage.
- Under the option “Non-Financial Transaction Request”, select SIP/SWP/STP Cancellation request.
- Tick the SIP box for placing the cancellation request. You might notice a drop-down list from where you can select mutual funds.
- A site will appear asking about your details, fill each and every detail correctly without making any mistakes after filling up the details, press next.
- Fill in the other details and print the form. You need to take this form and present it before the CAMS RTA local office or AMC office and lastly, submit the application. You will receive an acknowledgement receipt on the return of your submission.
How to Obtain SIP Cancellation Form From Karvy
- Go to the official website of Karvy, i.e., https://www.karvymfs.com/karvy/
- Click on the option “Mutual Fund Investor Services”.
- Under the “Downloads”, click on the option “services”.
- You have to scroll down in order to reach the “services” section and then click on click on SIP/STP/SWP cancellation request.
- After completing all the above steps, you will reach a webpage where you will have access to download the SIP cancellation form.
- After filling up the SIP cancellation form correctly, you need to present it before the Karvy RTA local office or AMC office and then submit it to them. Every time remember to collect the acknowledgement receipt, which will act as proof in the near future if anything goes sideways.