SIP Process Education

What Is a SIP

A Systematic Investment Plan (SIP) allows an investor to invest a fixed amount in a mutual fund scheme at regular intervals, such as monthly, rather than investing a lump sum at one time.

Step 1: Completing KYC

Before investing, an investor must complete the Know Your Customer (KYC) process, which involves submitting identity and address proof as required under regulatory norms.

Step 2: Selecting a Mutual Fund Category

Investors, based on their own goals and time horizon, identify the broad mutual fund category that may be appropriate, with general investor education support if needed.

Step 3: Setting Up the SIP Mandate

A SIP mandate is registered with the investor's bank, authorising periodic debits on a chosen date for the specified SIP amount, which is then invested in the chosen scheme.

Step 4: Ongoing Investment and Statements

Each SIP instalment purchases units at the scheme's applicable NAV on the transaction date. Investors receive periodic account statements summarising their holdings and transactions.

Step 5: Reviewing Your SIP

Periodic review helps investors confirm that their SIP continues to align with their goals and time horizon, and to make any changes such as pausing, increasing, or stopping the SIP if circumstances change.

Step 6: Redemption

When an investor's goal is reached or circumstances require it, units can be redeemed, subject to any applicable exit load and tax provisions.

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