How to Cancel SIP?

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How to Cancel SIP?

To cancel your SIP (Systematic Investment Plan) in Nepal, follow these steps:

• Contact the Fund Manager: Approach the mutual fund manager’s. Request and fill out a SIP cancellation form or submit a formal letter, including all relevant details like your account information and SIP reference number.
• Cancel the Bank Mandate: Inform your bank to cancel the standing instruction or auto-debit mandate linked to the SIP. This ensures no further automated debits are made.

Why do Investors Cancel or Pause Their SIP in Between the Tenure?

Investors may decide to cancel or pause their SIPs for various reasons, including:

Financial Constraints: Situations like unexpected medical expenses, job loss, or reduced income may lead to halting investments.
Market Volatility: Fear of losses during market downturns can prompt investors to pause their SIP contributions temporarily.
Achievement of Financial Goals: Some investors stop SIPs once their financial objectives are met earlier than expected.
Fund Underperformance: A mutual fund not meeting performance expectations might encourage investors to cancel SIPs and look for better opportunities.
Shifting Priorities: Changing financial priorities or goals may necessitate redirecting funds to other investments.

Also read:
1. Benefits of SIP
2. SIP Risk

Frequently Asked Questions

1. Can an investor stop all the SIPs at the same time?
Yes, an investor can stop multiple SIPs simultaneously by submitting individual cancellation requests for each SIP.

2. Is there any penalty charged for canceling a SIP?
No, there is no penalty for canceling a SIP.

3. Can I restart a canceled SIP?
No, a canceled SIP cannot be restarted. However, you can register a new SIP for the same mutual fund.

4. What happens to my existing units after canceling the SIP?
Existing units remain in your account and continue to grow based on market performance until you decide to redeem them.