Mutual fund SIP investors: Changed primary bank account but money is deducted from old account for SIP? What you need to do
mutual fund investor changes his/her primary bank account in the mutual fund folio there are certain things to keep in mind, otherwise, he may have to incur unnecessary charges and hassle. If there is an active SIP (Systematic Investment Plan) running in your mutual fund account and you change your primary bank account in that folio, then the bank account through which the SIP money is deducted will not automatically switch to the new bank account. You have to manually cancel the SIP mandate and create a fresh mandate with the new bank. If you do not do this or forget to do, then it will create a paradoxical situation where your mutual fund’s primary bank account and SIP deduction account will become different.
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Read on to find out why and how to solve this kind of problem.
Changing bank account? Need to create fresh mandate for SIP
According to Swapnil Aggarwal, Director, VSRK Capital, when an investor changes their primary bank account linked to a mutual fund folio, any existing SIPs do not automatically switch to the new account. Instead, the SIP deductions will continue from the previously registered bank account.
Aggarwal says that you need to update the bank account for SIP deductions if you want to change it to a new bank account.
“To do this the investor must submit a fresh SIP mandate that includes the new bank details. This is usually done by filling out a
