Insufficient funds in bank account for SIP transactions

POSTED BY cpdhutadmal ON April 7, 2012 3:02 pm COMMENTS (17)

Dear All,
Any idea as to what happens if there are not engough funds in the banks account for SIP transactions. Questions are

1. Is it considered just like a cheque bounce or what ? If yes, does bank charge any amount from the account holder ?

2. Does SIP from the next month continue as it is or it is stopped from the date when there are no sufficient funds in the account ?

3. Is it considered as a defaulter case and reported to CIBIL?

Pointwise reply is solicited.

Regards
Chandrakant D.

17 replies on this article “Insufficient funds in bank account for SIP transactions”

  1. B.Subhadra murthy says:

    I invsted Rs15000 as one time lump sum investment in SBI bluechip fund(g). But some mistake occurred and it is SIP Investment. I do not even have enough balance in my account to deduct towards SIP right now I am in the US and will return only in October-November 2017. How do I deal with it. It costs us a fortune to send signed copies for cancellation of the same.

    1. All you can do is ask the broker with whom you start SIP to stop it ! ..

      And then restart the SIP once you are back !

  2. Meenu says:

    Do I need to give cheq in case of ecs gig returned due to fund insufficient balance for that particular month

  3. Vinita says:

    Every month Rd for 3000 debit through Ecs from my HDFC salary account but this month my ecs got returned due to insufficient balance
    Kindly guid what can I do to keep my track continue and my Rd is getting matured in the month of august .. kindly guid me

    1. It will again restart next month.. nothing to worry as such

  4. Deepak says:

    HDFC charged me RS.402.50 as reversal due to insufficient balance

    1. Yes, for SIP missing, the bank levies the charges !

  5. Ram says:

    I have some financial hardship for one month and I could not fund my back account. Is there any way to stop ECS for one month ?

  6. BanyanFA says:

    Hi,
    Generally the banks may end up charging if the ECS bounces due to insufficient balance. Banks detail this charge on their website.

    SIPs would continue to exist upto 2-3 more instalments. After that SIP would terminate.

    Regards
    BFA

  7. bharat shah says:

    this deduction is ECS return charge by your bank bank.
    in my case , though i paid the insurance premium of kotak term life insurance due in JAN’12 well in advance online through net banking , they raised ECS for premium due in JAN ’13 in FEB ’12 (some 11 months advance) ,and ECS was returned due to insufficient balance in my account , and my bank deducted Rs.100/- for ECS return. and moreover i got two(computer generated) letters from kokak insurance for arranging that premium(due in JAN’13) to keep the policy alive! one letter was even after clarifying the matter through email and their conformation to cancel my mandate (if any) of ECS for payment of the premium. on contacting to the call center, they confirmed the cancellation of the ECS, and advise to ignore such letter. this is how the (faulty designed) computer aided system works! this is only to state my experience with INSURANCE PAYMENT , and not relating much to the query.

  8. Dear Chandrakant, for the given situation, as per bank’s own policy, bank may impose penalty on the account holder for not maintaining the balance to honor the SIP amount. Please check with your respective bank for the details.

    Sip from next month ‘ll continue but as rightly pointed out by dear justgrowmymoney, 2 or more such bounce may stop your SIPs & you w’d have to reapply for your SIPs.

    No it’s not reported to CIBIL.

    Thanks

    Ashal

    1. Azan says:

      Arshal bhai how to restart the sip in hdfc bank.
      i have bounce 3sip continusly ,
      i have started sip for 2 years only 1 last month is left ie. August.
      plzzz tell me what can i do now.

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  9. Adithya says:

    SIP continues and yes there will be MICR return charges levied by bank. Check your bank website for exact amount

    And it will not come in CIBIL report .

  10. Srinivas T says:

    HDFC charged me Rs200
    SIP continues.

  11. 1) There wont be any fees charged
    2) This will not be reported to CIBIL!
    3) Typically if 2 SIP installments bounce the AMC/Broker will cancel the SIP. So in a 10 year SIP is there are 2 such instances happening even years apart the SIP will be stopped. and you just need to restart the SIP!!

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