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Mutual Funds - How to renew SIPs of mutual funds
23-Jul-2012
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Investors sign up for systematic investment plans (SIP) with mutual funds for a fixed number of instalments over a specified period. At the end of the term, the investors have the option to renew the SIP to ensure continuity.The asset management company (AMC) usually sends a communication to the investor towards the end of the SIP term, asking for renewal. The decision can be taken based on the performance of the investment and its suitability to the investors needs. The communication from the fund house may come with the SIP renewal form, which can be downloaded from the website.

Form

The investor needs to give details of the bank account from which the SIP instalment has to be debited. He can give the ECS mandate from a bank account that is different from the earlier one.

SIP details

At the time of renewing the SIP, the investor can change the instalment amount, date or frequency of investing.

Renewal time

To ensure an uninterrupted investment, send the renewal instruction at least 30 working days before the last date. If the existing SIP expires, the renewal can be done by quoting the same folio number. It will take 21-30 days from the date of sending the form for the SIP to start.

Points to note

Once the SIP is registered, the AMC shall send a communication to the investor, confirming the SIP scheme, amount, frequency, date of start and the bank account number. If the existing folio is not KYC compliant, the investor needs to submit a copy of the KYC acknowledgement with the renewal instruction. If the SIP has been activated on an online platform, the investor can give renewal or fresh instructions as mandated by the platform provider.

The content on this page is courtesy Centre for Investment Education and Learning (CIEL)

Source : ET back