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Will fund housed levy a penalty if my SIP has bounced

My questions are: 1. what happen when we don't have money in bank account and SIP is due? Are fund house do penalty on investor? 2. Can we stop our SIP without redeem? If yes then what will happens with our units? 3. Are all fund house trustworthy? I mean can we trust that they are not fraud and our investment will be save?

May 10, 2017 by Sallauddin, New delhi  |   Mutual Fund

1. Fund houses do not impose or charge any penalty in case the SIP ECS bounces from your bank due to insufficient fund in your bank account. However, most of the banks levy a 'bank charge' due to the SIP ECS dishonour.

2. Yes, you can stop the SIP anytime and it has nothing to do with redemption. You can stop the SIP by writing to the fund house. Normally the fund houses take 3 to 4 weeks for stopping your SIP. However, you can continue to hold the balance units till such time you want even after closure of the SIP. Your units continue to remain active in your SIP portfolio and perform based on the rise and fall of the scheme NAV.

3. Yes, Funds houses are absolutely trust worthy as they are well regulated by SEBI (Securities Exchange Board of India) and your investments in funds are watched by a board of trustees who work in the best interest of the unit holders.

Hope we could reply your query in detail. Thanks :)

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