A SIP bounce charge is a penalty levied by a bank on an investor’s account when an automated SIP transaction fails due to insufficient funds. These charges vary by bank and are applied for each failed transaction.

Key Points About SIP Bounce Charges:

• Who Levies the Charge?

The bank holding the investor’s account is the one that levies the charge, not the asset management company (AMC) or mutual fund distributor (MFD). This is because the SIP transaction is a debit instruction issued to your bank.

• Mechanism of Failure

SIPs use automated payment systems like ECS (Electronic Clearing Service) or NACH (National Automated Clearing House) to debit a fixed amount from your account on a specific date. When the debit instruction is executed and there isn’t enough money in the account, the transaction “bounces” or is “returned”.

• Impact on Investment

A bounced SIP transaction means that the investment for that particular installment doesn’t go through. This can disrupt your investment plan and may affect your long-term wealth creation goals. While AMCs do not levy a penalty for a failed SIP, they will automatically cancel the SIP mandate after a certain number of consecutive failures. The general rule is that after three consecutive failed payments, the SIP is automatically stopped. You would then need to set up a new SIP if you wish to continue investing in the same fund.

• Charges Structure

The amount of the charge is not standardized and differs from one bank to another. For example, some banks may charge ₹250 per instance, while others might charge ₹500 or more. Some banks might also have a tiered structure based on the number of consecutive failures.

 

Bank Name	SIP Bounce Charges/ECS/NACH (Excluding GST and per instance)
SBI	Rs.250
HDFC	1st instance – Rs.450 (Sr Citizen – Rs.400)
	2nd  – Rs.500 (Sr Citizen – Rs.450)
	3rd onwards – Rs.550 (Sr Citizen – Rs.500)
ICICI	Rs.500
Kotak Mahindra	Rs.500
Axis	Rs.500 (first) and Rs.550 (subsequent)
Federal Bank	Rs.250 (first) and Rs.500 (subsequent)
Bank of India	Rs.250
Punjab National bank	Rs.250
Yes Bank	Rs.200
Canara Bank	Rs.300 (for SIP of up to Rs.1000), Rs.400 (between Rs.1000 to Rs.5000), Rs.450 (Rs.5000 to 10,000), Rs.475 (Rs.10,001 to Rs.1 lakh) and Rs.500 (Rs.1 lakh to Rs.50 lakh), Rs.1000 (Rs.50 lakh to Rs.1 crore) and Rs.2000 (On Rs.1 crore and above)
Indian Overseas Bank	Rs.250
Bandhan Bank	Rs.500
Union Bank	Rs.400
CSB Bank Limited	Rs.500
City Union Bank	Rs.300
Dhanlaxmi Bank	Rs.450 and Rs.400 for senior citizens
IndusInd Bank Limited	Rs.350 (for first instance in one quarter) and Rs.500 (for second instance in a quarter
IDFC First Bank	Rs.350 for up to 3 instances and Rs.750 on subsequent instances
Karnataka Bank Limited	Rs.500
Karur Vysya Bank Limited	Rs.500
Nainital Bank Limited	Rs.250
RBL Bank	Rs. 500
South Indian Bank Limited	Rs.50
IDBI Bank	Rs. 500

Data Source: Websites of the respective banks, as on 29th Aug 2025

How to Avoid SIP Bounce Charges?

✅ Maintain Sufficient Balance:
The most effective solution is to ensure your bank account has enough funds to cover the SIP amount at least one or two days before the scheduled debit date.

✅ Set up Reminders:
Use your phone’s calendar or a banking app to set up automatic reminders a few days before your SIP date. This can help you remember to check and top up your account balance.

✅ Align SIP Dates with Income:
Consider scheduling your SIP date a day or two after your salary or primary source of income is credited to your bank account. This minimizes the risk of a bounce due to insufficient funds.

✅ Link the Right Account:
If you have multiple bank accounts, make sure the one linked to your SIP is the one where you consistently maintain a healthy balance, rather than a secondary or savings account you don’t frequently use.